Global Equity Markets last week confirmed  intentions to play out a bounce-up in the week ahead with the S&P 500 closing above our decision line of 2,620 while the TSX closed well above 15,300 confirming same. More from Ziad Jasani of the Independent Investor Institute.

View our weekly Weekly Report recorded Wednesday here

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Recorded: April 4, 2018
Duration: 1:09:19

How did we end last week?

• US inflation data (Core PCE) printed in line with consensus, while the personal savings went up and spending went down. Net effect was a weaker USD, weaker US Treasury yields but still a ~25% probability for a 4th rate hike in 2018
• Trump backed-off the “Amazon Witch Hunt” and Technology rallied, out-performing markets overall (QQQ, XLK, IYW, FNG); restoring some confidence, and reducing the woes Facebook saturated the market with lasttwo weeks.
• Commodities (Oil, Gold, Silver, Steel, Copper) setup for a short-term (days-to-a-week) swing low formation; led by Oil closing > $65
• Global Equity Markets ended last week confirming their intention to play out a bounce-up in the week ahead with the S&P 500 (SPX) closing well above our decision line of 2,620 after essentially bouncing-up-off its 200-day average (support); while the S&P 500/Toronto (TSX) closed well above 15,300 confirming same

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• We saw “incredible” outflows from equity and bond markets post the late January correction, however, last week central banks stepped in, with the Eurozone Central Bank (ECB) buying Bonds and the Bank of Japan (BOJ) buying up the Nikkei – roughly 25% of the YTD inflows have unwound through the correction
• We noted the S&P 500 Volatility Index (VIX) confirmed a swing high formation, supporting Mr. Market (Equities) fashioning a bounce week of April 2
• We noted that there is some clean-air for the first few days of this week and likely up till April 6 when we receive U.S. Average Hourly Earnings and the official March 2018 Jobs data
• When asked, our Community Consensus was for Scenario B to play out for the S&P 500 this week < 2,703 but  > 2,645 and for Scenario C to play out for the TSX < 15,400 but  >14,786

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NOTE: Scenario B is more realistic for the TSX in the front end of the week, as Commodities are in swing-low formation and the USD is likely to remain suppressed supporting Commodities)

• For those willing to take-on risk, our community was guided to buy-Into this next potential Macro-Market swing-low when SPY broke above $261.15 (shortly after 10:10am EDT March 29) and courtesy of Trump we got another buy signal at 1:45 pm (EDT) when SPY broke and held above $263.30; the focal areas were SPY, DIA, QQQ, IWM, XIC-T, HXU-T with some specialization on XFN-T, ZEB-T, XEG-T, ZEO-T, XMA-T, HOU-T, XLB, XME, XBI, XPH, XLE, RYE, XOP, XLI, XLK, IYW, XST-T, DBB, DBC, ACWX, FXC

• We noted that Q1 earnings are likely to present top line challenges which adds to the fractures we have seen on the global-growth theme throughout Q1 2018; hence we are playing out bounces with short-term capital, while remaining closer to the Hold decision for longer-term positions while ACWI & the S&P 500 remain above their respective 200-day averages.

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