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Tuesday, July 26, 2016

Daily udpate 7/26 Faith in Central Banks Today is Stronger Than Faith in the Internet in 1999

Odd day.

After testing yesterday's high this morning the market suddenly sold off hard for a few minutes.  It tested yesterday's low and the selling stopped.  After the market lazily retraced the down move there was another bout of selling in the afternoon.  I would guess a big fund was doing some kind of portfolio adjustment.  The breadth was +58%.  New highs were pretty good at 216.  The volume was higher today, but a lot of it came during the sell off.  Did somebody take advantage of the tendency to be an up day before the FED meeting to dump some inventory?

The market started up out of the chute.  However, as soon as the futures hit 2168 to the tick selling began.  That 2168 level may be getting tougher instead of softening up.  That remains to be seen though.  There were several tests below the 20 SMA in the last few bars.  Either that line will break or the 2168 level will be conquered to set up the next short term move.  Maybe the FED meeting tomorrow will break the consolidation.

This is an interesting read.  Faith in Central Banks Today is Stronger Than Faith in the Internet in 1999  Pretty interesting chart.

Rather than investing in a legitimate growth story where higher profits justify higher prices, investors have been willing to accept lower returns over “risk free” US Treasuries and they’ve been paying increasingly more for a shrinking earnings base.

Best quote heard in relation to politics lately.  "Neither candidate is electable, but one of them will be the next president".


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