MARCON Update
The previous week MARCON was scattered all over the place while this week they've synced alongside each other. This is a good thing, I like it when the markets are in sync and a 76% reading across CSI with a 72% reading on the MARCON means the bulls are in clear control and we are not extremely overbought. An important note of caution: Last week we managed to regain just over 50% of what we lost. While positive, this means we aren't out of the woods yet so don't get cocky just because we closed strong on Friday.
AGG picked up some additional strength yet again and I imagine if stocks were to drop next week some folks might be tempted to make an entry into the F-Fund. We do have 3 closes above the dominant descending trendline. However, on the 6, 3 and 1 month timeframe AGG is in a clearly defined downtrend.
Watch the Transports, never a day goes by when I don't. With the increased cost of transporting goods, we can expect this to be reflected here. No biggie, just be aware there is a magic number for the price of oil and when we hit that number, consumers will shut down this economy. We've already broken this trendline twice, the 1st time the trend was resumed because we made a higher high. The current reading sits at 68% weaker than other charts I've measured. It's possible we could form a trading range here creating some great opportunities to dart in and out of stocks based on the previous high/low.
For overall market direction, I'll be watching 8212.66 on the New York Stock Exchange (NYSE.) At this level we have support from the previous yellow circled shelf, and resistance off last weeks low where buyers stepped in. A break below this level puts the bears in short-term control of prices.
