Weekly 41

 Weekly Update Week 41

This stockmarket is fully valued now. We are trading at a high risk of a correction from here. The forward P/E of S&P500 is at almost 22 with a ten year average of 17,9. This is why it is also very choppy. Shifting from Sector to Sector on a Daily basis. One day we have Energy up and the next Technology and by the end of the week the Financial Services Sector went straight up. It is like a gray-hound race to new ATH.

Next week we have earnings mostly from the Financial Services Sector and an important Retail Sales report on Thursday that has to come in line with expectations or higher to not disappoint the stockmarket. The Technology Sector and the Russel 2000 has to stay above new highs. And we have of course the geopolitical situation that can take unpredicted turns any day. This is a sick market, we have to be aware of that. The stocks are being chased up by algotrades and heard instinct in many cases and we are not in a sound market with the normal buy and sell,  supply and demand situation.

The safest investments are in physical gold and silver along with the usual Real Estate, art and that.

What will make Silver take off? When will that happen? I don´t have a clue but can follow the prices and related stocks. When will Gold stocks take a new leg higher? I think we have to wait a little bit more for that. In the meantime we can have a look at Copper and Energy. Copper has been in correction for August and September but is in a steady uptrend that looks to be renewed soon. When looking at XLE the energy ETF it is also in uptrend and so are the stocks. We are experiencing gains in XOM and KMI for example. Faraday Copper is a Canadian exploration company finding Copper in Arizona. 

FDY.TO Faraday Copper Corp.

Weekly

The Sectors:

The Energy Sector is still working on the Weekly trend but should soon find it. Basic Materials Sector and Industrial Sector are already positive in all timeframes.

Until last month the Consumer Defensive Sector, Healthcare, Real Estate and Utilities Sector was leading with positive momentum but that has now shifted. They are all four in negative Daily. Longer timeframes intact. 

Communication Services Sector is at 0 in Daily now but many stocks are really going in this Sector so we can expect it to turn positive. I believe the election is positive for this Sector.

Technology Sector recaptured the positive trend.

Consumer Cyclical Sector is positive but are weakening in the Daily. This weeks Retail Sales report will probably determine the trend going forward.

Lastly we have the Financial Services Sector that has been improving the last few weeks and now it is in full swing higher. This is where we look for the strongest trades the coming week.

Have a nice weekend!

/Trader Sven