Wednesday, January 30, 2019

#RetailStocks Review $XRT

Retail Stocks Review
Those that view the message of the market on daily basis are likely confused by trading noise. While trading noise contributes to the long-term trends, it does not define them. Human behavior tries to explain trading noise as a meaningful trend. This confuses the majority which, in turn, contributes to their role as bagholders of trend transitions.

Retail Stocks' overall trend, revealed by trends of price, leverage, and time, are defined and discussed in the The Matrix for subscribers.

Subscriber Comments

Investors tend to incorrectly assume the Fed sets the trends. Their new dovish position has boosted stocks - either because investors assume a Goldilocks backdrop, or the invisible hand knows a slowing economy within a brewing debt crisis mean few "parking" options for capital. It's possible that stocks become the asset of choice as options for privacy and mobility of wealth become restricted in the coming years. Please remember that nearly 70% of US GDP is driven by private consumption. Retail spending/retail stocks, a good proxy for private consumption, have been under performing the broader market for 18 weeks. This trend, unfortunately, is NOT extended and could easily last another 30-40 weeks. Under performance of retail should be telling the Fed to expect the unexpected in terms of the US economic growth. It's probably why the Fed has transition from Hawkish to Dovish over the span of one quarter. Politician will be happy, but the invisible hand understands that bad things happen when interest rates and confidence decline together. Anyone tracking the Matrix knows what gold is saying. The PMC and alignment gave us a heads up long before the Fed meeting.

I suggest closely tracking retail stocks intermarket trend in the Matrix (line 79). It will say more about what's going on than the talking heads.

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Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.