Monday, November 25, 2013

High Prices Beget Higher Prices- Price/Volume Heat Map for Nov. 22

It should probably go without saying that I remain bearish overall. The economy remains weak, profit margins are abnormally high, and the investment/economic environment continue to be manipulated by the Federal Reserve's money printing/bond buying train. That said, it has been my observation that higher prices beget higher prices and the S&P 500 closing at an all-time high- following the Dow Jones- suggests equity prices will continue to trend higher. For how long is anyone's guess, as overall volume levels remains subdued and demand (as evidenced by the price/volume heat maps below) has become mixed. With that said, I would not expect us to get any definitive answers in this week's trading, considering the Thanksgiving holiday in the US.

Looking at the latest daily heat map, we are seeing a few divergences. For instance, the discretionary price performance versus demand.

Week Ending  Nov. 22
For the latest ended week, the S&P 500 closed marginally higher, but it was enough to push the index to all time highs.

That said, demand appears weak overall and the weekly performance was limited in scope.

No comments:

Post a Comment