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Market Direction Is Important –
Updated Chart of the S&P 500 and Secondary Signals
Of our Four secondary indicators under our MTI:
Relative Strength Index (RSI)-Positive
Chaikin Money Flow (CMF)-Positive
Money Flow Index-MFI-Positive
More on the Market and the Economy:
Stocks finished with gains following a solid jobs report on Friday, and the S&P 500 closed the week with a .1% gain.
This week data will be released on small business optimism, the trade deficit and the Job Openings and Labor Turnover survey.
The economy added 227,000 jobs in January, marking the biggest gain in four months, with hiring led by construction firms, restaurants and retailers. The unemployment rate ticked up to 4.8% as more people entered the labor force.
The Fed held interest rates unchanged at last week’s FOMC meeting, as “the labor market has continued to strengthen and that economic activity has continued to expand at a moderate pace”. The FOMC also noted that “household spending has continued to rise moderately while business fixed investment has remained soft”.
The Atlanta Fed’s GDPNow model forecast for first quarter growth rose to 3.4% following the release of data on manufacturing and construction spending.
US manufacturers expanded in January at the fastest pace in over two years, as the ISM manufacturing index rose to 56%, marking its fifth consecutive gain and the highest level since 2014. Measures of new orders and employment both reached the highest level in two years.
The service sector grew at slower pace in January, though still solid, as measures of activity and new orders slipped.
Pending home sales jumped 1.6% in December, closing out 2016 on a good note. According to the National Association of Realtors, “Pending sales rebounded last month as enough buyers fended off rising mortgage rates and alarmingly low inventory levels1 to sign a contract. The main storyline in the early months of 2017 will be if supply can meaningfully increase to keep price growth at a moderate enough level for households to absorb higher borrowing costs. Sales will struggle to build on last year’s strong pace if inventory conditions don’t improve”.
The National Retail Federation forecast that Americans would spend an average $75 for the Super Bowl, amounting to a total $14.1 billion. Among the estimated 188.5 million Super Bowl viewers, 80% planned to spend money on food and beverages, 11% on team apparel, and 8% planned to splurge on a new TV.