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Wednesday, April 20, 2016

Daily update 4/20 Jim Grant: "Make America Solvent Again"

Did the bulls run out of steam today?

SPX stopped a few points short of the Nov. high.  Breadth was +53%.  New highs dropped way down to 132.  That is a significant loss of momentum.  Volume increased again.  Back to back doji bars (looking at SPY) on increasing volume is suspicious.  There were sellers active today once again. 

The futures show price has stalled out.

The green count slipped a bit today.  Another sign of a loss of momentum.

From about 11:30 the market went into a slow creep up pattern for several hours.  Upside was tough to come by as sellers were hitting the bids.  I have noticed that type of intraday pattern at short term turning points before.  In fact the Feb. low was made that way.  The market went into a slow creep down pattern before reversing in the afternoon.  SPX has never been able to stay above 2100.  This could end up being another failure.  This might be the point people start taking profits. 

April historically is one of the strongest months for the market.  That is followed by the sell in May thing though.  The last three years did not see significant sell offs from a May high.  The only big pullbacks came late summer last year and early fall in 2014.  It seems like it is probably time for a bigger sell off from an April/May high. 

This is another interesting read.  Jim Grant: "Make America Solvent Again" 


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