Sunday, October 26, 2008

Weekly Rewind - Week 43 (10/24/08)

(Click to Enlarge)

"Click, click, click" goes the stuck needle. Last week the S&P 500 (SPY) gave up its prior weekly gains and then some, finishing down -6.6%. This left the index at fresh lows: down -25% on the month, -39% on the year, and -45% from year-ago highs. Emerging Markets (EEM) were even harder hit, posting an -18.8% loss for the week!

In fact, the period's only relative bright spots were Utilities, Healthcare and the US Dollar (XLU +0.2%; XLV -1.5%; UUP +5.7%) on the global recession trade (Reuters - Dollar Races on Fears; Economist - Global Recession Looms). However, with both RSI(2) and RSI(5) exceeding 90, the Dollar proxy ETF looks exceedingly overbought in spite of being the only tracked security exhibiting any trend strength whatsoever (82). Lastly, once again the VIX options volatility index set a record close of 79 on Friday, off ten points from its morning high at the limit-down open.

Week 43 of 2008 occurs in the midst of on-going earnings and will feature a busy economic calendar, the least of which will not be the outlook text from Wednesday's FOMC Policy Statement:

Let's hope that record needle at least stays in the grooves next week.

Never Investment Advice


Anonymous said...

Hi Jeff

With the yen in a overbought
rsi,, and the dollar about to run into major resist at 92.20 i will have a great interest in the way the market behaves next week,, the yen has never failed to roll over once it reaches this zone, of course there will be many factors i am sure..

Good luck next week Jeff

play safe,,,lol


Jeff Pietsch CFA, Esq said...

Accidentally posted response in the prior entry.

Jeff Pietsch CFA, Esq said...

Apparently the Fed will announce Wed. this week, not Tues.