This week the country participated in an historic election and investors participated in changing their minds. After strong gains on Tuesday and in the prior week, the markets proceeded to lose 10% in the next two days after the election. The blame was assigned to the ADP employment report which indicated a continued weakening in the job market. Then we had a bad ISM services report. When Cisco's John Chambers delivered a downbeat assessment of the economy and of the next couple of quarters, the markets sold off again. The non-farm payrolls numbers were published on Friday and they were worse than economists expected but better than a pessimistic Wall Street expected. In a surprising reversal, stocks rallied on Friday though they ended the week with about a 4% loss. Small-caps and mid-caps fared even worse.
Against this backdrop, we see the signals based on daily data continuing to show some bullish change while the signals based on weekly data at least show less bearishness. Here is the breakdown for this week:
- based on daily data, we have 39 BUY signals and 4 SELL signals
- based on weekly data, we have 8 BUY signals and 8 SELL signals