Interview with Mr. Mark Arbeter CMT/President, Arbeter Investments LLC. Mr. Arbeter discusses the improvement in the market’s technicals which suggest that the SP can finally break above resistance. He also discusses his views on bond yields, emerging markets, and oil.
Well, well, well said the Bear to the growing numbers of bullish investors – not so fast. Another trip to the 200-day moving average by the S&P 500, and almost to the bear market trendline as Ms. Market saw a large Do Not Pass Go sign. The sign also says do not collect $200 which could also be a reference to the 200-day average. The SPX gave back 1.6% Wednesday, the NASDAQ shedded 1.2% and the QQQ’s dropped 1.3%. Both the S&P 400 and the Russell 2000 ran smack into chart resistance from their recent highs in November and December and did a 180. Yields across the curve continued their retreat from their October and November highs, obviously getting more and more worried about the weakening economy. The 2-year Treasury yield is down to 4.08%, about 64 basis points (bps) below its high, and the 5-year yield finished at 3.44%, a stunning 100 bps below its high. The 10-year closed at 3.38% and the lowest level since September. The yield curve (2/10 spread) remains very inverted at 70 bps. Meanwhile, the Federal Reserve keeps barking out hawkish comments when anyone puts a microphone in their face. By the way, some of the recent economic reports were not just bad, they were terrible. The battle rages on!