Archive for the ‘Chart School’ Category

Home Prices Rose 5.1% Year-over-Year, Increases Ease in May

Courtesy of Doug Short’s Advisor Perspectives.

With today’s release of the May S&P/Case-Shiller Home Price we learned that seasonally adjusted home prices for the benchmark 20-city index were down month over month at -0.1%. The seasonally adjusted year-over-year change has hovered between 4.4% and 5.4% for the last twelve months.

20-City Month-over-Month The adjacent column chart illustrates the month-over-month change in the seasonally adjusted 20-city index, which tends to be the most closely watched of the Case-Shiller series. It was down -0.1% from the previous month. The nonseasonally adjusted index was up 5.2% year-over-year.

Investing.com had forecast a -0.1% MoM seasonally adjusted decrease and 5.5% YoY nonseasonally adjusted for the 20-city series.

Here is an excerpt of the analysis from today’s Standard & Poor’s press release.

“Home prices continue to appreciate across the country,” says David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices. “Overall, housing is doing quite well. In addition to strong prices, sales of existing homes reached the highest monthly level since 2007 as construction of new homes showed continuing gains. The SCE Housing Expectations Survey published by the New York Federal Reserve Bank shows that consumers expect home prices to continue rising, though at a somewhat slower pace.”

“Regional patterns seen in home prices are shifting. Over the last year, the Pacific Northwest has been quite strong while prices in the previously strong spots of San Diego, San Francisco and Los Angeles saw more modest increases. The two hottest areas during the housing boom were Florida and the Southwest. Miami and Tampa have recovered in the last few months while Las Vegas and Phoenix remain weak. When home prices began to recover, New York and Washington saw steady price growth; now both are among the weakest areas in the country.” [Link to source]

The chart below is an overlay of the Case-Shiller 10- and 20-City Composite Indexes along with the national index since 1987, the first year that the 10-City Composite was tracked. Note that the 20-City, which is probably the most closely watched of the three, dates from 2000. We’ve used the seasonally adjusted data for this illustration.

Home Price Index

For an understanding of the home price data over longer time frames, we think a real, inflation-adjusted visualization of the data is an absolute necessity. Here is…
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Richmond Fed: Manufacturing Activity Improves in July

Courtesy of Doug Short’s Advisor Perspectives.

Today the Richmond Fed Manufacturing Composite Index jumped 20 points to 10 from last month’s revised -10. Investing.com had forecast -4. Because of the highly volatile nature of this index, we include a 3-month moving average to facilitate the identification of trends, now at 0.2, still indicating expansion. The complete data series behind today’s Richmond Fed manufacturing report (available here), which dates from November 1993.

Here is a snapshot of the complete Richmond Fed Manufacturing Composite series.

Richmond Fed Manufacturing

Here is the latest Richmond Fed manufacturing overview.

Fifth District manufacturing activity improved in July, according to the most recent survey by the Federal Reserve Bank of Richmond.* New orders and shipments increased this month, while backlogs flattened. Employment rose modestly, while firms continue to report wage increases. Prices of raw materials and finished goods rose at a slower pace in July, compared to last month.

Manufacturers looked for better business conditions during the next six months. Firms expected moderate growth in shipments and in the volume of new orders in the six months ahead. In addition, survey participants anticipated increased capacity utilization and expected backlogs to rise. Expectations were for little change in vendor lead times during the six months ahead.

Survey participants’ outlook for the months ahead included mild growth in the number of employees. Future wage increases were more prominent in the July expectations index. Firms expected faster growth in prices paid, however, anticipating somewhat slower growth in prices received. Link to Report

Here is a somewhat closer look at the index since the turn of the century.

since 2000

Is today’s Richmond composite a clue of what to expect in the next PMI composite? We’ll find out when the next ISM Manufacturing survey is released (below).

Because of the high volatility of this series, we should take the data for any individual month with the proverbial grain of salt.

Let’s compare all five Regional Manufacturing indicators. Here is a three-month moving average overlay of each since 2001 (for those with data).

Here is the same chart including the average of the five.

Here are the remaining four monthly manufacturing indicators that we track:

Texas Manufacturing Outlook Survey (TMOS)

Kansas City Manufacturing Survey

Empire State Manufacturing Survey

Philadelphia Fed Manufacturing Business Outlook Survey

Regional Fed Overview





Consumer Confidence Held Steady in July

Courtesy of Doug Short’s Advisor Perspectives.

The latest Conference Board Consumer Confidence Index was released this morning based on data collected through July 14. The headline number of 97.3, was slight decline from the June final reading of 97.4 in June Today’s number was above the Investing.com consensus of 95.9.

Here is an excerpt from the Conference Board press release.

“Consumer confidence held steady in July, after improving in June,” said Lynn Franco, Director of Economic Indicators at The Conference Board. “Consumers were slightly more positive about current business and labor market conditions, suggesting the economy will continue to expand at a moderate pace. Expectations regarding business and labor market conditions, as well as personal income prospects, declined slightly as consumers remain cautiously optimistic about growth in the near-term.”

Putting the Latest Number in Context

The chart below is another attempt to evaluate the historical context for this index as a coincident indicator of the economy. Toward this end we have highlighted recessions and included GDP. The regression through the index data shows the long-term trend and highlights the extreme volatility of this indicator. Statisticians may assign little significance to a regression through this sort of data. But the slope resembles the regression trend for real GDP shown below, and it is a more revealing gauge of relative confidence than the 1985 level of 100 that the Conference Board cites as a point of reference.

Consumer Confidence

On a percentile basis, the latest reading is at the 55 percentile of all the monthly data points since June 1977, unchanged from the previous month.

For an additional perspective on consumer attitudes, see the most recent Reuters/University of Michigan Consumer Sentiment Index. Here is the chart from that post.

Consumer Sentiment

And finally, let’s take a look at the correlation between consumer confidence and small business sentiment, the latter by way of the National Federation of Independent Business (NFIB) Small Business Optimism Index. As the chart illustrates, the two have tracked one another fairly closely since the onset of the Financial Crisis, although a bit of spread has appeared in the second half of 2015 and start of 2016.

NFIB Optimism and Consumer Confidence





June New Home Sales Jump 3.5% Month-over-Month, Better Than Forecast

Courtesy of Doug Short’s Advisor Perspectives.

This morning’s release of the June New Home Sales from the Census Bureau came in at 592K, up 3.5% month-over-month from a revised 572K in May. Seasonally adjusted estimates for March and April were revised. The Investing.com forecast was for 560K.

Here is the opening from the report:

Sales of new single-family houses in June 2016 were at a seasonally adjusted annual rate of 592,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 3.5 percent (±23.9%)* above the revised May rate of 572,000 and is 25.4 percent (±27.9%)* above the June 2015 estimate of 472,000. [Full Report]

For a longer-term perspective, here is a snapshot of the data series, which is produced in conjunction with the Department of Housing and Urban Development. The data since January 1963 is available in the St. Louis Fed’s FRED repository here. We’ve included a six-month moving average to highlight the trend in this highly volatile series.

New Home Sales

Over this time frame we see the steady rise in new home sales following the 1990 recession and the acceleration in sales during the real estate bubble that peaked in 2005.

The Population-Adjusted Reality

Now let’s examine the data with a simple population adjustment. The Census Bureau’s mid-month population estimates show a 72.2% increase in the US population since 1963. Here is a chart of new home sales as a percent of the population.

Population Adjusted

New single-family home sales are about 0.2% above the 1963 start of this data series. The population-adjusted version is 41.8% below the first 1963 sales and at a level similar to the lows we saw during the double-dip recession in the early 1980s, a time when 30-year mortgage rates peaked above 18%. Today’s 30-year rate is around 4%.


For additional perspectives on residential real estate, here is the complete list of our monthly updates:





Markit Services PMI Remained Muted in July

Courtesy of Doug Short’s Advisor Perspectives.

The July preliminary US Services Purchasing Managers’ Index conducted by Markit came in at 50.9, down from 51.3 in June and below the Investing.com consensus of 52.0. Markit’s Services PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction.

Here is the opening from the latest press release:

July data suggested that growth in the U.S. service sector remained muted, with activity rising at the weakest pace in the current five-month sequence of expansion. A slower increase in new business was also recorded. On a more positive note, the rate of job creation picked up slightly and business sentiment improved markedly from June’s record low. On the price front, slower increases were registered for both input costs and output prices during the month. [Press Release]

Here is a snapshot of the series since mid-2012.

Markit Services PMI

Here is an overlay with the equivalent PMI survey conducted by the Institute for Supply Management (see our full article on this series here).

Markit and ISM Services PMI

The next chart uses a three-month moving average of the two rather volatile series to facilitate our understanding of the current trend.

Markit Services PMI

Both series have weakened over the past several months. The interim three-month moving average of the Markit Services index peaked in August of 2014. The ISM index peaked in September of 2015. The two were fairly closely aligned at the beginning of this year, but they have diverged in recent months with the Markit index signaling noticeably weaker growth.





Gann Angles on the Dow Jones Industrials

Courtesy of Read the Ticker.

gann-angles-on-the-dow-jones-industrialsLet’s review the Dow Jones Industrial with Gann Angles.



We have jump to the long Gann Angle sourced from the 2007 highs, this is major resistance. A charge to 19,000 is required to bust this line. However this blog suspects more of the same consolidation along the angle. If there sellers are in charge then this is were they start to unload.





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INDU




NOTE: readtheticker.com does allow users to load objects and text on charts, however some annotations are by a free third party image tool named Paint.net



Investing Quote…



..“It cost me millions to learn that another dangerous enemy to a trader is his susceptibility to the urgings of a magnetic personality when plausibly expressed by a brilliant mind.”…



Jesse Livermore





..”Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected”..



George Soros





..”Stock market bubbles don’t grow out of thin air. They have a solid basis in reality, but reality as distorted by a misconception”..



George Soros





…..“I measure what’s going on, and I adapt to it. I try to get my ego out of the way. The market is smarter than I am so I bend.”..



Martin Zweig





..“Because of the extreme challenge, one must commit full attention to it.” Market speculation is “no different than trying to be a successful doctor or lawyer … you simply must devote yourself full-time to the study of your craft”…



Bernard Baruch











Market Recap Jul 25, 2016

Courtesy of Blain.

Indexes gapped down mildly at the open and stayed in a very narrow range all day.  The S&P 500 fell 0.30% and the NASDAQ 0.05%.   The Federal Reserve is scheduled to conclude its two-day meeting Wednesday afternoon. While the central bank is not generally expected to raise rates, indications in the statement on the timing of the next hike will be watched closely.

“I think everyone is really waiting for a big week — big week for earnings, big week for monetary policy,” said Jeremy Klein, chief market strategist at FBN Securities.

If you believes markets “rhyme” then we have about 2 more years of rallying to go; of course central bank intervention has been unprecedented in this rally so who knows if there where will be a similar pattern.

markets

You can clearly see on the NASDAQ chart why we are running into some resistance here.  If the bulls can clear this trendline in blue it should bode well.  The S&P 500 is also in a very narrow band as it builds a base.

“While the SPX has finally broken out, we can’t expect the seemingly unobstructed advance to continue with nary a hiccup. Yes, it has been impressive, and breadth is still undeniably strong. But at some point momentum will slow, and the market must prove it can hold its own, despite operating in a new stratosphere (above 2,135),” wrote Frank Cappelleri, technical analyst at Instinet LLC.

spx

nasdaq

The NYSE McClellan Oscillator actually fell into the red for the first time in about a month so it is something to keep an eye on.  One day need not make a trend but if we have a sustained negative reading wile the indexes hold up, it usually means we need to get a bit more cautious.

NYMO

Last week we said oil was bashing it’s head against this $44 level and was prone to fall through; that finally happened today.

wtic

BGC downgraded Apple (AAPL) to “sell” from “hold” and also cut its price target based on expectations that fewer than forecast customers will upgrade to the next iPhone. The broker also cited Apple’s…
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Weekly Gasoline Price Update: Regular and Premium Down for Sixth Consecutive Week

Courtesy of Doug Short’s Advisor Perspectives.

It’s time again for our weekly gasoline update based on data from the Energy Information Administration (EIA). The price of Regular and Premium five and four cents each, respectively, from last week. According to GasBuddy.com, California has the highest average price for Regular at $2.79 and San Francisco is averaging $2.96. South Carolina has the cheapest at $1.83. The WTIC end of day spot price closed at 43.13, a decrease of 2.81 from this time last week.

How far are we from the interim high prices of 2011 and the all-time highs of 2008? Here’s a visual answer.

Weekly Gas Prices Since 2000

The next chart is a monthly chart overlay of West Texas Light Crude, Brent Crude and unleaded gasoline end-of-day spot prices (GASO).

WTIC BRENT GASO

In this monthly chart, WTIC end of day spot price closed at 43.13, down 2.81 from last week.

WTIC

The volatility in crude oil and gasoline prices has been clearly reflected in recent years in both the Consumer Price Index (CPI) and Personal Consumption Expenditures (PCE). For additional perspective on how energy prices are factored into the CPI, see What Inflation Means to You: Inside the Consumer Price Index.

Consumer Price Index

The chart below offers a comparison of the broader aggregate category of energy inflation since 2000, based on categories within Consumer Price Index (commentary here).

CPI Components

Here are some additional commentaries related to gasoline prices:





S&P 500 Snapshot: A Weak Start to the Week

Courtesy of Doug Short’s Advisor Perspectives.

Global equity indexes outside the US were mixed today, and the big three US indexes were uniformly negative. The NASDAQ finished fractionally lower at -0.5%, while the Dow and S&P 500 settled at bit lower at -0.31% and -0.30%, respectively. Our benchmark 500 opened lower and sold off to its -0.60% intraday low during the lunch hour. It then struggled higher in a couple of waves to half its loss at -0.30%. The popular financial press pointed fingers at oil for the weak session. West Texas Intermediate Crude fell 2.40% to its lowest close in exactly three months.

The yield on the 10-year closed at 1.58%, up one basis point from the previous session.

Here is a snapshot of past five sessions in the S&P 500.

Here is a daily chart of the index. Trading volume was summertime light.

S&P 500

A Perspective on Drawdowns

Here’s a snapshot of selloffs since the 2009 trough.

S&P 500 Drawdowns

Here is a more conventional log-scale chart with drawdowns highlighted.

S&P 500 MAs

Here is a linear scale version of the same chart with the 50- and 200-day moving averages.

S&P 500 MAs

A Perspective on Volatility

For a sense of the correlation between the closing price and intraday volatility, the chart below overlays the S&P 500 since 2007 with the intraday price range. We’ve also included a 20-day moving average to help identify trends in volatility.

S&P 500 Snapshot





Dallas Fed Manufacturing Outlook: Activity Stabilizes in July, Outlook Improving

Courtesy of Doug Short’s Advisor Perspectives.

This morning the Dallas Fed released its Texas Manufacturing Outlook Survey (TMOS) for July. The latest general business activity index increased in July, up 17 points, coming in at -1.3, up from -18.3 in June. Other measures of manufacturing activity reflected increasing and improving conditions.

Here is an excerpt from the latest report:

Texas factory activity held steady in July, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, came in near zero after two months of negative readings, suggesting output stopped falling this month.

Some other measures of current manufacturing activity also reflected stabilization, and demand declines abated somewhat. The capacity utilization and shipments indexes posted near-zero readings, up from negative territory in May and June. Thenew orders index rose six points to –8.0, while the growth rate of orders index rose nine points to –9.7.

Perceptions of broader business conditions were notably less pessimistic. While the general business activity index remained negative for a nineteenth month in a row, it jumped 17 points to –1.3 in July. The company outlook index also remained negative but rose, climbing from –11 to –2.3.

Monthly data for this indicator only dates back to 2004, so it is difficult to see the full potential of this indicator without several business cycles of data. Nevertheless, it is an interesting and important regional manufacturing indicator. The Dallas Fed on the TMOS importance:

Texas is important to the nation’s manufacturing output. The state produced $159 billion in manufactured goods in 2008, roughly 9.5 percent of the country’s manufacturing output. Texas ranks second behind California in factory production and first as an exporter of manufactured goods.

Texas turns out a large share of the country’s production of petroleum and coal products, reflecting the significance of the region’s refining industry. Texas also produces over 10 percent of the nation’s computer and electronics products and nonmetallic mineral products, such as brick, glass and cement.

Here is a snapshot of the complete TMOS.

Dallas Fed Manufacturing

The next chart is an overlay of the General Business Activity Index and the Future Outlook Index — the outlook six months ahead.

For comparison, here is the latest ISM Manufacturing
continue reading





 
 
 

Zero Hedge

Why Swap Spreads Are Suddenly Blowing Out And Why This Is Good For Treasuries

Courtesy of ZeroHedge. View original post here.

Over the past week, market watchers have noticed something which otherwise could be seen as a warning signal: there has been a dramatic move in swap spreads space, notably a substantial widening in recent days from what was until recently record tight - and negative - levels, coupled with a blow out in FX swaps, where the EURUSD has seen its cross-currency swap slide -3 bps today to -48 bps, the widest since July 2012. And, as UBS puts it in a report by Chirag Mirani overnight, "the recent move wider in swap spreads warrants attention."

However instead of reflecting funding pressures...



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Phil's Favorites

Service PMI Barely Above Contraction

Courtesy of Mish.

The Markit Flash Service PMI now sits at 50.9, barely above contraction. This is the weakest rise in five months.

Service Sector Activity

Key Findings

  • Growth of activity eases to five-month low in July
  • New orders and employment rise again
  • Business sentiment picks up following dip in June

July data suggested that growth in the U.S. service sector remained muted, with activity rising at the weakest pace in the current five-month sequence of expansion. A slower increase in new business ...



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Chart School

Home Prices Rose 5.1% Year-over-Year, Increases Ease in May

Courtesy of Doug Short's Advisor Perspectives.

With today's release of the May S&P/Case-Shiller Home Price we learned that seasonally adjusted home prices for the benchmark 20-city index were down month over month at -0.1%. The seasonally adjusted year-over-year change has hovered between 4.4% and 5.4% for the last twelve months.

The adjacent column chart illustrates the month-over-month change in the seasonally adjusted 20-city index, which tends to be the most closely watched of the Case-Shiller series. It was down -0.1% from the previous month. The nonseasonally adjusted index was up 5.2% year-over-year.

Investing.com had forecast a -0.1% MoM seasonally adjusted decrease and 5.5% ...



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ValueWalk

David Einhorn Q2 2016 Letter: Hit On Amazon, Fracking Shorts

By Jacob Wolinsky. Originally published at ValueWalk.

David Einhorn’s letter for the second quarter ended June 30, 2016.

ValueWalk has obtained David Einhorn’s Q2 letter to investors. Below readers can find a full copy – below is a brief summary.

Also see

David Einhorn Q1: Long YELP [FULL Q1 2016 Letter] Greenlight Capital Q4 Letter To Investors: Long Macys Greenlight Capital 3Q15 Letter: Still Long Sune, MU

David Einhorn sold Macy’s, as well as “several material positions” during the...



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Kimble Charting Solutions

Junk Bonds at important inflection point, should impact stocks!

Courtesy of Chris Kimble.

Junk bonds have been quality at sending Risk On and Risk Off message to the broad stock market. Below looks at Junk Bond ETF JNK over the past decade.

JNK finds itself at an important price point below and what it does in the upcoming couple of weeks could become a big influence on the Risk On/Risk Off trade.

CLICK ON CHART TO ENLARGE

...

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Market News

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Fed seen holding rates steady as inflation watch continues (Reuters)

The U.S. Federal Reserve is expected to keep interest rates unchanged this week, deferring any possible increase until September or December, as policymakers hold out for more evidence of a pickup in inflation.

U.S. stock futures waver ahead of Fed, key earnings (Market Watch)

U.S. stock futures struggled for direction on Tuesday, with investors opting for the sidelines ahead of the closely watched Federal Reserve meeting and a deluge of ear...



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OpTrader

Swing trading portfolio - week of July 25th, 2016

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Digital Currencies

Demystifying the blockchain: a basic user guide

 

Demystifying the blockchain: a basic user guide

By Philippa Ryan, University of Technology Sydney

Companies around the world are exploring blockchain, the technology underpinning digital currency bitcoin. In this Blockchain unleashed series, we investigate the many possible use cases for the blockchain, from the novel to the transformative.

Most people agree we do not need to know how a television works to enjoy using one. This is true of many existing and emerging technologies. Most of us happily drive cars, use mobile phones and send emails without knowing how they work. With this in mind, here is a tech-free user guide to the blockchain - the technology infrastructure behind bitcoin...



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Mapping The Market

No wonder Saudis are selling as much as they can!

Courtesy of Jean-Luc

We are getting much more energy efficient – no wonder Saudis are selling as much as they can! Who wants to be the one with trillions of dollars of oil in the ground unwanted:

http://arstechnica.com/science/2016/07/the-amount-of-energy-needed-to-run-the-worlds-economy-is-decreasing-on-average/#p3

...

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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Biotech

This Is Why Biotech Stocks May Explode Again

Reminder: Pharmboy and Ilene are available to chat with Members.

Here's an interesting article from Investor's Business Daily arguing that biotech stocks are beginning to recover from their recent declines, notwithstanding current weakness.

This Is Why Biotech Stocks May Explode Again

By 

Excerpt:

After a three-year bull run that more than quadrupled its value by its peak last July, IBD’s Medical-Biomed/Biotech Industry Group plunged 50% by early February, hurt by backlashes against high drug prices and mergers that seek to lower corporate taxes.

...



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Promotions

PSW is more than just stock talk!

 

We know you love coming here for our Stocks & Options education, strategy and trade ideas, and for Phil's daily commentary which you can't live without, but there's more!

PhilStockWorld.com features the most important and most interesting news items from around the web, all day, every day!

News: If you missed it, you can probably find it in our Market News section. We sift through piles of news so you don't have to.   

If you are looking for non-mainstream, provocatively-narrated news and opinion pieces which promise to make you think -- we feature Zero Hedge, ...



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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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