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Market Update

Market Direction Is Important –

Updated Chart of the S&P 500 and Secondary Signals

Of our Four secondary indicators under our MTI:

  1. Relative Strength Index (RSI)-Positive

  2. Chaikin Money Flow (CMF)-Positive

  3. MACD- Positive

  4. Money Flow Index-MFI-Positive

More on the Market and the Economy:

Stocks followed a lackluster January by posting solid gains for February. After slipping 3.1% in January, the S&P 500 closed the month with a 5.49% gain – its best monthly performance since October 2011. The Dow ended the month up 5.64% – its best month since January 2013.


With 485 companies in the S&P 500 having reported earnings, the blended earnings growth rate for the fourth quarter stands at 3.7%.

This week the market will hear data on manufacturing, consumer spending, the service sector, factory orders, the trade deficit, the Fed’s Beige Book and the jobs report.

In her testimony to the Senate Banking Committee on Tuesday, Fed Chair Janet Yellen signaled that the Fed will soon drop the word “patient” from its guidance. That comment was tempered by her emphasis that a change in wording does not mean a hike right away: “a modification of the forward guidance should not be read as indicating that the Committee will necessarily increase the target range in a couple of meetings”.

The tone was less pleasant on Wednesday when Yellen appeared in front of the House of Representatives Financial Services Committee. The typically reserved Fed Chair was more animated, snapping back at accusations that the central bank has a liberal bias and talking over politicians that tried to interrupt her.

Then on Friday Fed Vice Chair Stanley Fischer hinted that the Fed won’t be giving too much forward guidance in the future. Fischer said that the Fed will not “telegraph every action”, and that it would be constrained by being “pre-committed” to a steady path for rate hikes. While the Fed “doesn’t want to take the markets by surprise on a regular basis” he doesn’t know of any “plans of following a deterministic path to raise rates”.

Some Americans have given up on the idea of retirement. Just over one-fourth of Americans (26%) actually plan to stop working when they reach retirement age, according to a new survey released by The Pew Charitable Trusts. More than half of those surveyed (53%) plan on doing something else like working a different job. And 21% said they never plan to retire. While people are living longer and some like the idea of continuing to work, for others it’s a matter of making ends meet. One of the problems is debt: according to the EBRI, 65.4% of families with a head of household age 55 or older carried debt in 2013.

Landline phones are quickly losing relevance, according to data from the Center of Disease Control and Prevention. Ten years ago, 9 out of 10 US households had a landline – now just every other household has one. During the first half of 2014, around 103 million adults (43.1% of all adults) lived in a household with only wireless phones, and more than 38 million children (52.1% of all children) lived in a wireless household.


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