The Zigmont Report (Daily Market Recap for 11/21/17)

Mike Zigmont

Mike Zigmont, author of the Zigmont Report, is a partner at New York-based Harvest Volatility Management, a hedge fund with over $10B AUM, offering volatility management solutions to its investor base worldwide.  Mike has been publishing his daily newsletter (Monday-Friday) privately for the firm’s investors and his personal contacts in the investment business since 2008, sending it daily shortly after the market close.

The opinions expressed below are my own

Bulls get thankful.  The bulls are going to have a fantastic Thanksgiving – the bears not so much.  Overseas markets rallied well overnight with China really pouring it on and rallying almost 2%.  European equities rallied about 50 bips.  There was no news to inspire markets so bullishly, as far as I can tell.  It looks like new highs were within reach and the bulls just made their move to print new highs.  Last week we had a bit of a battle between the bulls and the bears and it looked like the bears were finally resisting.

Au contraire.

The bulls broke the bears today, on no news and blah volume (104% capital flow), like they have dozens (hundreds?) of times before.  The consistency of the rally is remarkable.  Here’s a good picture.

This is the S&P over the last year.  It never traded below its 100-day moving average.  It never even recorded an RSI with an oversold condition in the past year!

I don’t believe technicals are predictive but for quantifying the past, they can be very interesting…. And since words don’t seem to do the rally justice, might as well go to some technicals.

Tomorrow will be a full day of trading but I expect activity to shrivel to almost nothing after the open.  Barring a war, we’re essentially into the weekend since Friday has an early close.

I’ll send you Recaps both days but the week is unofficially already over.  Bulls win.

See you tomorrow,