April 29, 2013

Equity Market Review

Kevin Lane Email:

Phone: 1-212-661-2022 klane@fusioninvest.com

Summary Comments
Markets continue to extend their bounce after a recent and shallow correction. Defensive areas such as consumer staples and utilities have continued to lead the market higher, although last week, tech and in particular, semiconductors jumped to the forefront. Economic news still tends to be split, with some good and some bad. CEOs on conference calls, especially those in economically sensitive areas of the global economy sound more cautious than bullish, however, the market continues to ignore it, right or wrong. The key question becomes is the recent spate of cautionary economic data the start of something more grave or a mere soft patch ? The market by its strength could be saying this is a soft patch. Or the market could be ignoring the recent softening, because it feels world central bankers are on full alert, ensuring continued easing. This assurance of available credit seems to be what is supporting risk assets. In fact, one could argue that risk assets are being aided more by central bank actions than the real economy. Technically, trends remain up, supports have been tested and held, breadth remains intact, though weakened from earlier in the trend and sentiment remains mixed. Clearly as trends lengthen they dont remain as pretty as they were in the beginning of the move, however, the basic components though diminished, are still in place. We continue to be cognizant that the winds of seasonal change are upon us as we enter spring and summer, however, that seems to be a wall or worry point at present more than a reality. There is an old saying in war that goes, dont shoot until you see the whites of their eyes. I think this rings true in equity markets as well, meaning seeing divergences between price and momentum is one thing, but dont act until the trends actually give way !

Fusion Analytics Research Partners LLC 2013 All Rights Reserved

April 29, 2013

Equity Market Review

S&P 500 Index (SPX) - Daily Chart

The S&P 500 is still within an up sloping price channel holding above trend (orange lines), above its 50 day moving average (purple line) and above a support zone in the 1,540 1,530 area (green band). Until these supports below the market are violated or a series of distributive downside days occur you have to respect the trend.

New high in S&P 500 and new support zone in the 1,540 -1,530 area.

Fusion Analytics Research Partners LLC 2013 All Rights Reserved

April 29, 2013

Equity Market Review

Philadelphia Semiconductor Index (SOX) - Daily Chart

The SOX is in between resistance (red line) and support (orange lines) after successfully testing and bouncing off its 100 day moving average (green line). Volume trends on the recent up move have a bullish look.

Fusion Analytics Research Partners LLC 2013 All Rights Reserved

April 29, 2013

Equity Market Review

Durable Goods MoM change - Monthly Chart

Durable goods, both the recent raw reading, as well as the smoother 4 month moving average (purple line) are trending lower and is something to keep an eye on going forward.

Fusion Analytics Research Partners LLC 2013 All Rights Reserved

April 29, 2013

Equity Market Review

Cyclicals Index (CYC) - Daily Chart

Cyclicals have been setting lower peaks (red arrows) and are generally weaker than other indices. Of course, this makes sense with all the patchy economic data of late. 1,100 (orange line) is key downside support to watch.

Fusion Analytics Research Partners LLC 2013 All Rights Reserved

April 29, 2013

Equity Market Review

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