Markets are going wild for the Donald:
- MarketWatch – Trump just unleashed the stock market’s ‘animal spirits’
- CNBC – Goldman Sachs lays out the future it sees for the Trump rally in 2017
- Wall Street Journal – Get Ready for the Trump Jobs Rally
Who knew Donald Trump was all we needed to make everything Awesome!
I don’t see this lasting, but you should enjoy the irony for now.
There are two very good reasons I do Market Trend Analysis on a weekly basis:
- The trends can change very quickly;
- and I cannot use my intuition to analyze these trends – need the hard numbers.
This week is a perfect example – the market has been going higher, but many segments of the market are not – most stocks getting hurt fall into the popular “Replace Bonds with Dividend paying stocks” strategy. Note to all, stocks – even great dividend paying stocks are different from bonds! They can lose a lot of money – and should not be used to replace your bond allocation.
With that said – here are the numbers:
The following table is based on the Z Option Market Analysis Tool – which determines if a market is trending by assigning a trending score from -3 to +3. This helps us keep our trading with the trend.
| Symbol | Description | Short Term Trend | Medium Term Trend |
| $DJI | Dow Jones Industrial Average | 3 | 3 |
| SPX | S&P 500 INDEX | 3 | 3 |
| RUT | RUSSELL 2000 INDEX | 1 | 3 |
| NDX | NASDAQ-100 INDEX INDEX | -2 | 1 |
| VIX | CBOE MARKET VOLATILITY INDEX | -3 | -3 |
| /ZB[H7] | 30-Year U.S. Treasury Bond Futures,ETH | -3 | -3 |
| /ZN[H7] | 10-Year U.S. Treasury Note Futures,ETH | -3 | -3 |
| /GC[G7] | Gold Futures, ETH | -3 | -3 |
| /CL[F7] | Light Sweet Crude Oil Futures,ETH | 3 | 3 |
| /DX[Z6] | US Dollar Index Futures | 1 | 3 |
| $DJT | Dow Jones Transportation Average | 3 | 3 |
| XLK | SELECT SECTOR SPDR TRUST TECHNOLOGY SELECT INDEX | 1 | 3 |
| XLI | SELECT SECTOR SPDR TRUST INDUSTRIAL SELECT INDEX | 3 | 3 |
| XLY | SELECT SECTOR SPDR TRUST CONSUMER DIS SELECT INDEX | 1 | 3 |
| XLB | SELECT SECTOR SPDR TRUST MATERIALS SELECT SEC INDEX | 3 | 3 |
| XLE | SELECT SECTOR SPDR TRUST ENERGY SELECT INDEX | 3 | 3 |
| XLP | SELECT SECTOR SPDR TRUST CONSUMER STAPLES INDEX | -3 | -3 |
| XLV | SELECT SECTOR SPDR TRUST HEALTH CARE SELECT INDEX | -3 | -3 |
| XLU | SELECT SECTOR SPDR TRUST UTILITIES SELECT INDEX | -3 | -3 |
| XLF | SELECT SECTOR SPDR TRUST FINANCIAL SELECT SECTOR FUND | 3 | 3 |
Any market showing a 3 or a -3 is trending strongly – and should be factored into any options strategy you are contemplating.
Bond and Bond replacement equities are still getting crushed – in anticipation of Trump’s deficit spending plan – but trends can change quickly.
Extra – more on bonds:
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