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Gary Townsend - Since 2007, a founding partner, CEO and Portfolio Manager of Hill-Townsend Capital LLC, a long/short equity financial sector fund based in Chevy Chase, Maryland. Mr. Townsend has 30 years banking, regulatory, and investment experience. He started his business career in 1978, as... More
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  • Global Equities Rally As Europe Resists Further Sanctions On Russia 0 comments
    Jul 22, 2014 9:24 AM

    This morning. Today, U.S. equity futures are higher and near the top of their pre-market range, following an impressive global equity rally. Generally strong U.S. earnings and stalling U.S. led initiatives to emplace greater economic sanctions on Russia appear to be the rally's main drivers.

    In Asia, equities rose strongly, with better strength in China. In Europe, equities are also rallying, with greater strength in Milan. The dollar is mixed. The U.S. Treasury 10-year yields are higher. Commodities are mixed. Wednesday's Nikkei 225 September 2014 (NKU4) equity futures are modestly higher. The dollar is mixed. The U.S. Treasury 10-year yields are higher. Commodities are mixed. Wednesday's Nikkei 225 September 2014 (NKU4) equity futures are modestly higher. Since July 8th, the market outlook is "uptrend under pressure", after 5 distributions in the past 11 sessions.

    Monday, on lower and below average volume, the S&P 500 Index (SPX), DJ Industrials (Private:DJI) Nasdaq, and NYSE composite closed modestly lower, but recovered strongly from mid-morning lows. The SPX, DJI, Nasdaq, and NYSE composite fell -0.23%, -0.28%, -0.17%, and -0.26%, respectively. Last week, major indexes closed at least +0.38% higher. In July, indexes are mixed. In 2014, the SPX, DJI, and Nasdaq and NYSE composite are up +6.78%, +2.87%, +5.94%, and +5.36% higher, respectively.

    NYSE volume fell -28.5% to 0.79x its 20-day moving average.

    Other notable indexes were mixed. The DJ Transports (TRAN) fell -0.29% and ended -0.43% below its July 14th record high. The Russell 2000 (RTY) fell -0.28%. The Nasdaq Internet (QNET) index rose +0.23%, and the Nasdaq Biotech (NBI) index rose +0.13%. The QNET and NBI are down -8.78% and -8.06%, respectively, from their recent record highs.

    Trading desks attribute the worldwide rally to the combination of marginal progress in Russia/Ukraine, continued strong 2Q2014 earnings strength, and completion of market adjustments following last week's developments. Conviction is mixed, with little advantage to bull or bears, with the former pointing to earnings results, the latter to geopolitical risks and slowing European economic growth. Markets continue to consolidate.

    The 2Q2014 earnings seasons began June 18th, and now 102 of 499 SPX companies have reported with respective +6.04% and +1.49% adjusted EPS and revenues surprises. Financials (26 of 84 reporting) lead with respective +13.6% and +3.73% EPS and revenue surprises. In 1Q2014, 499 of 499 SPX companies reported with respective +5.91% EPS and +0.20% revenue surprises.

    Forward estimates have moved up. Respective estimates for 2014, 2015 and 2016 are now $119.31, $132.63, and $146965, respectively compared to $118.05, $131.36 and $145.70 at June-end, respective increases of +1.07%, +0.96% and +0.86%. Price earnings multiples remain elevated. With SPX equities trading at a 17.2x (compared to 17.1x the prior day) average 2014-15 earnings ($125.97), attention focuses on 2014-15 earnings and valuations (17.2x times survey 2014-15 SPX average operating earnings suggests a 2170.41 SPX level in the next year, a +9.97% rise from yesterday's close).

    Technicals were little changed. Most SPX market segments closed lower. Market breadth was negative, and up volume lagged down volume. Volatility rose, but remains well below average historical levels. Treasury bond markets strengthened. On the day, the U.S. Treasury 10-year bond yield fell -1.35 to close at 2.4674%, compared to 2.4809% at the prior close.

    This morning, 10-year U.S. Treasury yields are up +2.2.52 bps at 2.4926%, compared to the prior close. World sovereign bond markets are mixed. Spanish and Italian 10-year debt yields again near multi-year lows at 2.56% and +2.77%, respectively, compared to 2.57% and +2.77% the prior day.

    U.S. options markets are unchanged at neutral, compared to neutral the prior day. The CBOE SKEW fell -1.73% to 138.75, compared to 141.19 the prior day, well above 130, a level that correlates well with short-term market tops. The SKEW closed at a record 143.60 on June 20th.

    In pre-market futures trading, September SPX equity futures (SPM4) price near the top of their 1965-1976 trading range. After a fair value adjustment of +1.18 points, the SPU4 future prices at 1974.25, up +7.03 points. The SPX opens +0.25% and +1.81% above its respective 20- and 50-day moving averages, and +3.77% and +6.95% above its 200-day moving averages. Initial resistance is 1978.45. Initial support is 1967.29, then 1960.95.

    "Uptrend Under Pressure" Market Outlook and Distribution Day Count. Since July 9th, the market outlook is " uptrend under pressure". Monday, major indexes fell, though they closed well above their early lows, on lower volume, continuing their consolidation following record closes earlier in July. Since May 27th, distribution days number 6 for the SPX, Nasdaq, and NYSE composite, and 5 for the DJI.

    On May 27th, the market outlook improved to "confirmed uptrend", ending a period of market "in correction" that began on April 4th. The SPX closed July 3rd at a record 1985.59, +8.95% above the 1815.69 close on April 11th, the recent low close. On February 3rd, the Nasdaq closed at its 3,996.96 year-to-date low, but then recovered +11.6% to the July 3rd 4,458.65 multi-year record close.

    In Asia, equity markets rallied. The Nikkei 225 (NYSEARCA:NKY) rose +0.84%. The Hang Seng (HSI) Index rose +1.69%, and the Shanghai SE composite (SHCOMP) rose +1.02%. Both closed near their intraday highs. The NKY, HSI, and SHCOMP 50-day moving averages are below their respective 200-day moving averages. Today's volumes are unavailable.

    Economic reporting was light. Commentary focuses on falling prospects for further European sanctions on Russia, the direction of monetary policy, currency, and commodity price developments.

    This week, the NKY, HSI, and SHCOMP are up +1.18%, +2.36%, and +1.39%, respectively. The prior week, the NKY, HSI, and SHCOMP closed up +0.34%, +0.95%, and +0.59%, respectively. In July, the NKY is up +1.19%, the HSI is up +2.55%, and the SHCOMP is up +1.33%. In June, the NKY gained +3.62%, the HSI gained +0.47%, and the SHCOMP gained +0.58%.

    In 2014, the NKY is down -5.82%, the HSI is up +2.36%, and the SHCOMP is up +1.339%. In 2013, the NKY rose +56.7%. The HSI closed up +2.87%. The SHCOMP closed down -6.75%.

    In China, short-term interbank lending rates remain volatile, as the SHIBO 7-day rate rose only +24 bps to 3.90%, compared to 3.66% the prior day, up from a 2.26% low on March 11th, but down from the February 7th 5.41% recent high.

    Regional relative strength indexes (RSI) show that Tokyo, Hong Kong, and Shanghai are in a neutral ranges. The NKY RSI rose to 55.74, compared to 53.29 the prior session, up from an oversold 27.92 on February 4th, the most recent prior yearly low. The HSI RSI rose to 65.73, compared to 54.33 the prior day. The SHCOMP's RSI rose to 59.17, compared to 51.17 the prior session. On June 27, 2013, the index's RSI fell to a low of 15.27, which was also last year's low index close.

    In Japan, the NKY closed at 15,343.28, compared to 15,215.71 the prior day, -5.82% below its year-end 16,291.31 high and -60.6% below its late-1989 38,915.87 high close. The index rallied through the morning session to an early afternoon 15,392.02 intraday high, then traded narrowly through late afternoon, when it weakened into the close. All market segments closed at least +0.36% higher. Leaders were energy, materials, and industrials, which rose at least +1.12%. Laggards were health care, consumer discretionary, and financials.

    In China, in Shanghai, the SHCOMP closed at 2,075.48, compared to 2,054.48 at the prior close, +6.43% above the 1,950.01 June 27, 2013 close, last year's low. The index opened modestly lower, but reversed higher in early trading. The index rallied through the morning session to an early afternoon 2,078.07, then traded narrowly to the close. All market segments closed at least +0.27% higher. Leaders were health care, consumer discretionary, and consumer staples, which rose at least +0.17%. Laggards included technology, telecommunications, and energy, which fell at least -0.60%.

    In Europe, equity indexes have rallied strong, with greater strength in Milan. The Euro Stoxx 50, FTSE 100, CAC 40, and DAX are up +1.31%, +0.86%, +1.10%, and +0.97%, respectively. The Spanish IBEX 35 is up +1.33%. The Italian FTSE MIB is up +1.81%.

    Economic reporting is light. Commentary focuses on further U.S. and Eurozone economic sanctions on Russia, which appear unlikely. The euro is weaker compared to the dollar.

    European bourses have recently underperformed U.S. equity indexes. Intraday Euro Stoxx50 relative strength (RSI) is 45.55, compared to 38.71 at the prior close, in a neutral (30-70) range, better than its recent February 5th 33.57 closing low, which coincided with its 2014 low. The index's lowest recent RSI level was 25.77 on June 24, 2013, which marked the year's 2,494.54 closing low.

    The Euro Stoxx50 trades -39.5% below its 5,249.55 March 31, 2000, all-time closing high. From its prior day 3,137.06 close, the index gapped higher to 3,155, then rallied to 3,165 by mid-morning and 3,170 in early afternoon. The index rose to a mid-afternoon 3,178.92 intraday high, and currently trades at 3,175.64. All market segments are at least +0.42% higher. Leaders are energy, industrials, and utilities, which are up at least +1.47%. Financials are up +1.24%. Laggards are consumer discretionary, health care, and technology.

    This week, the Euro Stoxx50, FTSE 100, and CAC 40 are up +0.45%, +0.56%, +0.38%, while the DAX is down -0.14%. Last week, indexes ended higher, with the Euro Stoxx50, FTSE 100, CAC 40, and DAX up +0.23%, +0.89%, +0.44%, and +0.56%, respectively. In July, the FTSE 100 is up +0.64%, while the Euro Stoxx50, CAC 40, and DAX are down -1.54%, -1.60%, and -1.29%, respectively. In June, the Euro Stoxx50 closed up +0.03%, while the FTSE 100, CAC 40, and DAX closed down -0.88%, -1.53%, and -0.84%, respectively.

    In 2014, the indexes are higher. The Euro Stoxx50, FTSE 100, CAC 40, and DAX are up +2.23%, +0.56%, +1.30%, and +1.62%, respectively. In 2013, the indexes closed up +18.0%, +14.4%, +18.0%, and +25.5%, respectively.

    2Q2014 SPX Earnings. The 2nd quarter earnings season began June 18th, and now 102 of 499 SPX reporting firms have reported, with respective +6.04% EPS and +1.49% revenue surprises. Financials (26 of 84 reporting) lead with a 13.6% EPS surprise and +3.73% revenue surprise.

    In 1Q2014, of 499 (of 499) reporting companies, 370 or 74.5% surprised positively on earnings, with an average +5.91% surprise average. Of reporting companies, 263 or 53.0% reported sales or revenues above estimates. The average sales/revenue surprise was +0.20%. Energy led with respective +10.0% and -1.01% earnings and revenue surprises. Financials had a respective +5.67% and +0.26% earnings and revenue surprises. Consumer staples lagged with respective +0.34% and -0.66% earnings and revenue surprises.

    Valuation. The SPX trades at 17.9x estimated 2013 earnings ($110.15), 16.5x estimated 2014 earnings ($119.31), 14.9x estimated 2015 earnings ($132.63), and 13.4x estimated 2016 earnings ($146.96). The 10-year average median price/earnings multiple is 15.9x. Analysts expect 2014, 2015, and 2016 earnings to grow +8.31%, +11.2%, and 10.8%, respectively.

    The KBW Bank Index (BKX) trades at 13.7x 2013 adjusted EPS ($5.16), 12.8x estimated 2014 earnings ($5.51), 11.8x estimated 2015 earnings ($5.97), and 10.6x 2016 earnings ($6.66). Analysts expect 2014, 2015, 2016 EPS will grow +6.81%, +8.24%, and +11.7%, respectively.

    Composite, index, and equity options. Options markets are unchanged at neutral, compared to neutral the prior session. Composite options are neutral, index options are neutral, and equity options are neutral. The composite put/call ratio is 0.90, compared to 0.90 the prior day, and worse than 5- and 10-period moving averages of 0.88 and 0.90, respectively. The index put/call ratio is 1.06, compared to 1.11 the prior day, and worse than its 5- and 10-period moving averages of 0.97 and 1.00, respectively. The equity put/call ratio closed the day at 0.83, compared to 0.83 the prior day, and better than its 5- and 10-period moving averages of 0.86 and 0.87, respectively.

    NYSE Volume, Breadth Indicators. Volume fell -28.5% to 683.04 million shares, compared to 757.56 million shares the prior day, 0.79x the 683.04 million share 20-day moving average. Market breadth was negative, and up volume lagged down volume. Advancing stocks lagged by -799 (compared to +1,972 the prior day) or 0.58:1. Up volume was 0.65:1 down volume.

    Libor, LOIS, Currencies, Treasuries, Commodities:

    · USD LIBOR is 0.09250%, compared to 0.09150% the prior day. USD 3-month LIBOR is 0.23310%, unchanged from 0.23160% the prior day, and compares to the January 4, 2013, recent peak of 0.58250%.

    · The US LIBOR-OIS (LOIS) spread is 13.460 bps, compared to 13.560 bps the prior day, and compares to the recent June 12, 2012, 46.785 bps high. Euribor-OIS is 13.100 bps, compared to 13.100 bps the prior day, and down from the December 27, 2011, high of 98.800 bps. Moves in the LOIS indicate changes in intra-bank lending risk premiums.

    · The 3-month Euro basis swap curve is -9.880 bps, compared to -10.114 bps the prior day, up from a trough of -147.00 bps on December 14, 2011, and at the lower end of a normal -10 bps and -40 bps range.

    · German 10-year debt yields 1.17%, compared to 1.15% the prior day.

    · French 10-year debt yields 1.48%, compared to 1.45% the prior day.

    · Japanese 10-year debt yields are 0.54%, compared to 0.55% the prior day.

    · Spanish and Italian 10-year debt yields are lower. Spanish 10-year debt yields are 2.56%, compared to 2.57% the prior day, modestly above the U.S. 10-year yield and compares to its 2.575% June 9th low. Italian 10-year debt yields are at 2.77%, compared to 2.77% the prior day and their June 9th 2.704% recent low. Spanish and Italian 10-year debt yields peaked at 7.62% and 7.26%, respectively, in July 2012 and November 2011.

    · U.S. Treasury yields are higher, with 2- and 10-year maturities yielding 0.494% and 2.493%, respectively, compared to 0.490% and 2.467% Monday. The yield curve widened +2.120 bps, with the 2- to 10-year spread at +1.999%, compared to 1.978% the prior day. In the past year, the 2- and 10-year spread varied from a low of +1.996% on July 21, 2014, to a high of +2.648% on December 31, 2013.

    · The U.S. dollar is stronger compared to the euro, Japanese yen, and British pound. The dollar trades at US$80.729, compared to US$80.762 intraday high and US$80.560 the prior day, and better compared to its $80.335 50-day, US$80.067 100-day, and US$80.269 200-day averages. The euro trades at US$1.3484, compared to a US$1.3478 intraday low and US$1.3524 the prior day. The euro trades worse compared to its US$1.3612 50-day and US$1.3718 100-day averages, and compares to a multi-year low of US$1.1877 on June 7, 2010. In Japan, the dollar trades at ¥101.57, compared to ¥101.40 the prior day. The yen trades better than its 50-day moving average ¥101.82, and better than its January 1st 105.31 closing low, its weakest prior multi-year closing low.

    · Citigroup Economic Surprise Index improved to -16.10, compared to -18.00 the prior day. The index is mixed compared to its respective -15.90 5-day and -14.87 10-day moving averages. From a +72.70 high on January 15th, the index subsequently trended lower and turned negative on February 19th and fell to a -45.90 124-week low on April 7th. The index turned briefly positive in the latter half of May, but has been negative since May 29th. After a lag, the CESIUSD correlates with EPS revisions.

    · Commodities prices are mixed, with higher energy, lower precious metals, higher aluminum and copper, and mixed agriculture prices.

    Volatility, Skew:

    · The CBOE SPX volatility index (VIX) rose t+6.22% to 12.81, compared to 12.06 at the prior close. The VIX is +8.90% above the 11.76 20-day moving average. Its 30-day high is 15.38. Its 30-day low is 10.28. Its all-time closing low is 9.31 on December 22, 1993. The long-term average is 20.00.

    · The Euro Stoxx 50 volatility index (V2X) is 16.17, down -8.74% compared to 17.45 at the prior day's close. The V2X index trades +6.75% above its 15.15 20-day moving average, -13.5% below the 18.70 30-day high, and +31.5% above the 12.30 30-day low.

    · The Hang Seng volatility index (VHSI) closed at 13.17, down -2.01% compared to 13.44 at the prior close. The VHSI index trades +3.35% above its 12.65 20-day moving average. Its lowest historical close was 11.72, on June 30, 2005.

    · CBOE SKEW (SKEW) fell -1.73% to 138.75, compared to 141.19 the prior session, above a neutral reading (115-120) and since June 19th, and well above 130, a level that correlates well with short-term market tops. The recent record high was 143.26 on June 20, 2014. Its recent low was 112.47 on May 25, 2013. Spikes in excess of 130 correlate well with short-term market tops, as occurred last December, ahead of market declines last January. The index rarely falls below 110, last on July 31, 2009. The index correlates with market tail risks, the cost of buying out-of-the-money, long-dated options, i.e., options not affected by expirations. A rise suggests that investors are buying more puts than calls, a bearish signal.

    U.S. Economic Reporting and News:

    · At 8:30, June MoM CPI rose +0.3%, compared to +0.3% survey and +0.4% prior. CPI ex food and energy rose +0.1%, compared to +0.2% survey and +0.3% prior.

    · At 9:00, May MoM FHFA house price index, with +0.2% survey and +0.0% prior.

    · At 10:00, July Richmond Fed manufacturing, with 5 survey and 3 prior.

    · June MoM existing home sales with +1.9% survey and +4.9% prior.

    Overseas Economic Reporting and News:

    · Japan - May MoM all industry activity index rose +0.6%, compared to +0.6% survey and -4.6% revised prior.

    · United Kingdom - July CBI business optimism fell to 19, compared to 30 survey and 33 prior.

    Notable Company Ratings/News:

    · None.

    Monday's Trade. On lower and below average NYSE volume, major U.S. equity indexes closed lower, but much better than their mid-morning lows. The SPX, DJI, Nasdaq, and NYSE composite fell -0.23%, -0.28%, -0.17%, and -0.26%, respectively. In July, indexes are mixed. In 2014, the SPX, DJI, Nasdaq, and NYSE composite are at least +2.87% higher. Market breadth was negative, with gainers 0.58x losing stocks. Most SPX market segments closed lower. Leaders were energy, which rose +0.15%, and technology and utilities, which fell at least -0.02%. Financials fell -0.23%. Laggards were health care, consumer staples, and consumer discretionary, which fell at least -0.39%.

    Other notable indexes closed higher. The Russell 2000 (RTY) fell -0.43% and closed -5.13% below its March 4th record high. The Nasdaq Internet Index (QNET) rose +0.23% and is down -8.78% below its March 6th closing high. The Nasdaq Biotech Index (NBI) rose +0.13% and ended -8.06% below its February 25th record high.

    NYSE volume fell -28.5% to 541.42 million shares, compared to 757.56 million shares the prior day, 0.79x the 683.04 million share 20-day moving average volume. Bond markets strengthened. The U.S. 10-year yield moved lower to a late morning 2.4458% intraday low. The index ended at 2.4674%, down -1.35 bps from the 2.4674% prior close.

    From its prior day 1978.22 SPX close, September 2014 SPX futures (SPM4) suggested a moderately lower open. The index opened near 1972, and weakened further to a mid-morning 1965.77 intraday low before finding support. The index improved to 1970 by early afternoon then recovered to nearly 1976 before easing again into the close. The index closed at 1973.63, +83.6% above the 1074.77 October 4, 2011, intraday low, the bottom of the most recent correction.

    From its prior day 8,385.40 close, the DJ Transportation index (TRAN) fell -0.29%, compared to the DJI's -0.28% loss. At the open, the index fell to 8,320, then trended higher through the session to a late 8.386.58 intraday high. Volume fell -20.2% to 9.514 million shares, compared to 11.924 million shares the prior session, and 0.75x the 15-day moving average volume. The TRAN closed +1.37% and +3.06% above its respective 20- and 50-day moving averages, and +6.70% and +11.7% above its respective 100- and 200-day moving averages.

    Market volatility rose +6.22%, as the CBOE SPX volatility index (VIX) closed at 12.81 compared to 12.06 at the prior close. The index rose to a mid-morning 13.62 intraday high, then trended lower to a late 12.46 intraday low. The VIX's all-time closing low is 9.31, on December 22, 1993. Its record high is 89.53 in December 2008. Its lifetime average is 20.01. The CBOE put/call SKEW fell -1.73%, to 138.75, compared to 141.19 the prior session, above a neutral 115-120 range, and well above 130, a level that correlates well with short-term market tops. Its record 143.26 high came on June 20th.

    The market's technical factors worsened as the NYSE composite surrendered its 20-day moving average. The SPX relative strength (RSI) fell to 55.82, compared to 58.00 the prior day, in a neutral range, down from an overbought 73.73 on June 9th and up from an oversold 31.24 on February 3rd. The RSI compares to an overbought 71.26 on December 31st, when the SPX closed at an earlier record high, and compares to earlier oversold levels of 35.14 on August 27th and 39.19 on October 9th.

    Last week, indexes close higher. The SPX, DJI, Nasdaq, and NYSE composite are up +0.54%, +0.92%, +0.38%, and +0.45%, respectively. The prior week, the SPX, DJI, Nasdaq, and NYSE composite closed down -0.90%, -0.73%, -1.57%, and -1.52%, respectively. In July, indexes are mixed. The SPX, DJI, Nasdaq, NYSE composite are up +0.68%, +1.34%, and +0.37%, respectively, which the NYSE composite is down -0.20%. In June, the SPX, DJI, Nasdaq, and NYSE composite rose +1.91%, +0.65%, +3.90%, and +2.07%, respectively.

    In 2014, the SPX, DJI, Nasdaq, and NYSE composite are up +6.78%, +2.87%, +5.94%, and +5.36%, respectively. In 2013, the SPX, DJI, Nasdaq, and NYSE composite closed up +29.6%, +26.5%, +38.2%, +23.2%, respectively. All closed at least +5.91% higher in 2012.

    KBW Bank Index (BKX). On lower and below 15-day average volume, the BKX fell -0.35% to 70.51, compared to 70.76 at the prior day's close, -3.29% below its 72.91 March 20th post-2008 closing high. The index gapped lower and set an early 70.22 intraday low, then traded narrowly until early afternoon before rallying to nearly 70.60 late in the session. Volume fell -35.5% to 38.353 million shares, compared to 59.486 million shares the prior day, and 0.84x the 45.248 million share 15-day moving average.

    Large cap banks outperformed the regional banks, as the KBW regional banking index (KRX) fell -0.54%.

    Last week, the BKX closed down -0.30%, compared to the prior week, when the BKX fell -1.95%. In July, the BKX is down -1.12%, compared to June, when the BKX rose +3.48%. In 2014, the BKX is up +1.80%, compared to the SPX's +6.78% gain. In 2013, the BKX rose +35.1%, better than the SPX's +29.6% rise.

    The BKX is now +19.1% better than the June 24, 2013, 59.19 close, its worst since May 13, 2013. The index crossed above 50 on December 17, 2012, 60 on May 15, 2013, and 70 on January 8, 2014, but then dropped back below 70 on January 24th, which persisted until March 6th. On April 10th, the BKX fell below 70.00 and then eased consistently to the May 15th 66.81 closing low, its lowest close since early February. The BKX closed +116.6% above the 32.56 intraday low on October 4, 2011, the bottom of that year's correction. Large-cap bank stocks have outperformed the broader market's rebound, with the SPX up +83.6% in the same period.

    The BKX index closed -41.8% below its February 20, 2007, record 121.06 high. The BKX is up +278.7% from its 18.62 March 6, 2009, closing low, its low during the 2008-09 financial panic.

    Technical indicators were little changed. The index closed -1.12% below its 20-day moving average, but closed +0.52%, +0.57%, and +2.83% above its 50-, 100-, and 200-day moving averages. The 20-day moving average fell -5 bps to 71.31. The 70.11 50-day moving average rose +2 bps. Its 70.11 100-day moving average rose +2 bps, and the 200-day moving average rose +4 bps to 68.57. The 20-day closed (by +1.16 points) above the 50-day, and the gap narrowed -10 bps. The 50-day moving average closed (by +1.58 points) above the 200-day moving average, and the gap widened +2 bps. The 100-day moving average closed (by +1.54 points) above the 200-day moving average, and the gap narrowed -2 bps.

    The directional movement indicator improved to-5.124, compared to -5.373 the prior day, its 3rd consecutive negative reading. Relative strength fell to 46.75, compared to 48.44 the prior day, in a neutral range, down from an overbought 73.14 on June 9th, but up from the recent 32.95 low on February 3rd. The lowest recent RSI level was 31.08 on November 14, 2012, which is also the date of the BKX's 2012 closing low. Next resistance is 70.71; next support is 70.27.

    SPX, DJI, RTY, TRAN, CCMP, NYA, VIX, SKEW, NKY, EURUSD, USGG10YR, HSI, SHCOMP, SX5E, CAC, DAX, FTSE, JPY, GBP, EUR

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