WEEKLY MARKET DIGEST: YELLEN DOVISHNESS FLIES IN THE FACE OF STRONG DATA, SAUDI KILLS OIL RALLY, AGGRESSIVE SELLING IN SILVER $GLD $QQQ $SLV $USO

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WEEKLY MARKET DIGEST: YELLEN DOVISHNESS FLIES IN THE FACE OF STRONG DATA, SAUDI KILLS OIL RALLY, AGGRESSIVE SELLING IN SILVER $DIA $GLD $QQQ $SLV $SPY $TBF $TBT $USO

(The Weekly Digest reproduces the morning capsules made available every morning before the market open in the Real Time Feeds to the paying subscribers. ) 

LABOR MARKET RESILIENT, SAUDI KILLS OIL RALLY, HEAVY SELLING IN SILVER

This is what you need to know today.

March Employment Report shows that the labor market in the U. S. is resilient.  Most of the data is in line.

Non-farm Private Payroll came at 195K vs. 195K consensus.

Unemployment rate inches up to 5.0% vs. 4.9% consensus.

Hourly earnings rose 0.3% vs. 0.3% consensus.

Average work week came at 34.4 vs. 34.5 consensus.

There is a statement from Saudi Arabia indicating hesitation to cut production unless Iran also cuts production.  This statement has killed the oil rally.  Oil has broken major support at $37.50.

There is aggressive selling in silver.  Institutions that were buying gold for window dressing yesterday seem to be selling it now that the quarter is over.

Euro is stronger on ECB starting its previously announced new bond buying program.

late yesterday afternoon, interest rates starting falling and bonds starting rising as some anticipated weak jobs report.  The bond market initially gave up these gains after the report was released but have now rallied again.

Economic data from Japan is dismal.

Our very, very short-term early stock market indicator is negative.

Gold futures are at $1219, silver futures are at $15.00, and oil futures are $37.13.

S&P 500 resistance levels are 2063, 2100, and 2111; support levels are 2038, 2017, and 2000.

DJIA futures are down 88 points.

What To Do Now?

It is important for investors to look ahead and not in the rear view mirror.

Consider continuing to hold existing positions. Based on individual risk preference, consider holding cash 26 – 42%, and short to medium-term hedges of  25%.

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.  When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks.  High beta stocks are the ones that move more than the market.

A Reminder 

As our long time subscribers know well, that during the 2008 and early 2009 market crash, when stock market lost about 50%, subscribers to The Arora Report made money by the boat load.  For long only investors, this remarkable performance was achieved by using inverse ETFs.

Our models do not expect a repeat of 2008.  In the most likely worst case, there may be a garden variety bear market that typically occurred every 18 to 24 months prior to the recent six-year market run.

Individual Trades

Please click on Home on the left side of the Menu.  Scroll down on the Home Page for individual trades.

Click on the Search by Symbol/Tag on the right hand side and click on the symbols of interest.

QUARTER END WINDOW DRESSING, CHINA CREDIT DOWNGRADE, EUROZONE INFLATION AND RAND ROCKETS

This is what you need to know today.

Expect volatility from quarter end window dressing. Lately window dressing takes place two to three days before the quarter end.  However, it appears that this time is has been delayed to today due to Yellen’s speech.

Standard & Poor’s has cut the outlook of China credit from stable to negative.  China is likely to ignore this downgrade and continue to proceed with its agenda.

Finally some relief in Europe on the inflation front, Core Inflation came at 1% vs. 0.8% consensus.

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South African rand has moved to the highest level against the dollar since December on the news that South Africa’s highest court has determined that President Zuma was in violation of the constitution by using taxpayer money to upgrade his private residence.  South Africa’s market is obviously rooting for the fall of Zuma’s government.

For the first time in a long time, there is aggressive buying by institutions in gold.  Our tentative analysis is that this is due to window dressing.

Oil fell yesterday after better than expected data from DOE. This indicates that shorts think long positions in oil are long in the tooth.  The thinking is that if they push oil lower, Johnny come latelies will panic and sell, thus generating more profits for shorts.

Interest rates and bonds are range bound.

Euro is strengthening and just broke the resistance at 1.14 against the dollar.

Our very, very short-term early stock market indicator is neutral.

Gold futures are at $1235, silver futures are at $15.38, and oil futures are $38.16.

S&P 500 resistance levels are 2063, 2100 and 2111; support levels are 2038, 2017, and 2000.

2200 2150 2132 2111 2100 2063 2038 2017 2000 1962 1920 1909 1900 1860 1838 1800 1767 1732

DJIA futures are up 2 points.

What To Do Now?

It is important for investors to look ahead and not in the rear view mirror.

Consider continuing to hold existing positions. Based on individual risk preference, consider holding cash 26 – 42%, and short to medium-term hedges of  25%.

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.  When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks.  High beta stocks are the ones that move more than the market.

A Reminder 

As our long time subscribers know well, that during the 2008 and early 2009 market crash, when stock market lost about 50%, subscribers to The Arora Report made money by the boat load.  For long only investors, this remarkable performance was achieved by using inverse ETFs.

Our models do not expect a repeat of 2008.  In the most likely worst case, there may be a garden variety bear market that typically occurred every 18 to 24 months prior to the recent six-year market run.

Individual Trades

Please click on Home on the left side of the Menu.  Scroll down on the Home Page for individual trades.

Click on the Search by Symbol/Tag on the right hand side and click on the symbols of interest.

YELLEN’S EXTRA DOVISHNESS FLIES IN THE FACE OF NEW STRONG ADP DATA

This is what you need to know today.

In her speech yesterday, Yellen was extra dovish. Her dovishness sent stocks, bonds, oil, gold and other commodities higher.

Yellen has obviously become central banker of the world and not just the United States.  She is worried about global growth.

It is important to note that in spite of Yellen’s dovishness, Fed’s own dot plot shows two interest rate increases this year.

Newly released ADP Employment Change data is strong; it came at 200K vs. 196K.

At least for the today, there is no change in the overarching plan of all four of our services.  The next big data point is March employment report to be released on April 1 at 8:30 am ET.

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The dollar is weaker.

Our very, very short-term early stock market indicator is positive.

Gold futures are at $1234, silver futures are at $15.32, and oil futures are $39.16.

S&P 500 resistance levels are 2063, 2100 and 2111; support levels are 2038, 2017, and 2000.

DJIA futures are up 111 points.

What To Do Now?

It is important for investors to look ahead and not in the rear view mirror.

Consider continuing to hold existing positions. Based on individual risk preference, consider holding cash 26 – 42%, and short to medium-term hedges of  25%.

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.  When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks.  High beta stocks are the ones that move more than the market.

A Reminder 

As our long time subscribers know well, that during the 2008 and early 2009 market crash, when stock market lost about 50%, subscribers to The Arora Report made money by the boat load.  For long only investors, this remarkable performance was achieved by using inverse ETFs.

Our models do not expect a repeat of 2008.  In the most likely worst case, there may be a garden variety bear market that typically occurred every 18 to 24 months prior to the recent six-year market run.

Individual Trades

Please click on Home on the left side of the Menu.  Scroll down on the Home Page for individual trades.

Click on the Search by Symbol/Tag on the right hand side and click on the symbols of interest.

YEN FALLS FOR EIGHTH CONSECUTIVE DAY, YELLEN SPEECH AHEAD

This is what you need to know today.

Yen falls for the eighth consecutive day after Prime Minister, Shinzo Abe, said that he would seek to front-load spending for 2016.  As a full disclosure, ZYX Short has a short position in yen.

U. S. stocks do not like falling yen as it makes it harder for American companies to compete with Japanese companies.

Yellen will speak at 12:20 pm ET.  The markets are anxiously awaiting the speech to see if she gives any clues about interest rates.

Oil is falling on fears that API data to be releases at 4:30 pm ET will show a large build.

Interest rates and gold are range bound.

Our very, very short-term early stock market indicator is neutral but expect stocks to start the day lower.

Gold futures are at $1220, silver futures are at $15.14, and oil futures are $38.41.

S&P 500 resistance levels are 2038, 2063 and 2100; support levels are 2017, 2000, and 1962.

DJIA futures are  down 71 points.

What To Do Now?

It is important for investors to look ahead and not in the rear view mirror.

Consider continuing to hold existing positions. Based on individual risk preference, consider holding cash 26 – 42%, and short to medium-term hedges of  25%.

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.  When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks.  High beta stocks are the ones that move more than the market.

A Reminder 

As our long time subscribers know well, that during the 2008 and early 2009 market crash, when stock market lost about 50%, subscribers to The Arora Report made money by the boat load.  For long only investors, this remarkable performance was achieved by using inverse ETFs.

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Our models do not expect a repeat of 2008.  In the most likely worst case, there may be a garden variety bear market that typically occurred every 18 to 24 months prior to the recent six-year market run.

Individual Trades

Please click on Home on the left side of the Menu.  Scroll down on the Home Page for individual trades.

Click on the Search by Symbol/Tag on the right hand side and click on the symbols of interest.

FED’S FAVORITE INFLATION INDICATOR RELEASED, CHINA TAKES STEPS TO COOL RED HOT PROPERTY MARKET, AND TALK OF MORE JAPANESE STIMULUS

This is what you need to know today.

Fed’s favorite inflation indicator is not CPI or PPI, it is Core PCEPCE stands for personal consumption expenditure.  PCI measures actual and imputed expenditures of households.  Core PCE excludes energy and food.

This morning Core PCE for February was released, it came at 0.1% vs. 0.2% consensus.

Personal Income came at 0.2% vs. 0.1% consensus.

Personal Spending came at 0.1% vs. 0.1% consensus.

China takes steps to cool red hot property markets in tier one cities.  Property stocks tumble in China and dragged down the whole market.

The U. S. market, at least temporarily, is ignoring China. Many overseas markets are closed for long Easter holiday.

Overnight gold fell close to $1200.  Then aggressive buying came in.

Oil is attempting a rally.

Interest rates and bonds are range bound.

Yen is weaker on talk of more stimulus in Japan.

Euro is screaming higher against the dollar.

Our very, very short-term early stock market indicator is positive.

Gold futures are at $1219, silver futures are at $15.24, and oil futures are $39.40.

S&P 500 resistance levels are 2063, 2100 and 2111; support levels are 2017, 2000, and 1962.

DJIA futures are up 20 points.

What To Do Now?

It is important for investors to look ahead and not in the rear view mirror.

Consider continuing to hold existing positions. Based on individual risk preference, consider holding cash 26 – 42%, and short to medium-term hedges of  25%.

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.

A Reminder 

As our long time subscribers know well, that during the 2008 and early 2009 market crash, when stock market lost about 50%, subscribers to The Arora Report made money by the boat load.  For long only investors, this remarkable performance was achieved by using inverse ETFs.

Our models do not expect a repeat of 2008.  In the most likely worst case, there may be a garden variety bear market that typically occurred every 18 to 24 months prior to the recent six-year market run.

Individual Trades

Please click on Home on the left side of the Menu.  Scroll down on the Home Page for individual trades.

Click on the Search by Symbol/Tag on the right hand side and click on the symbols of interest.

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