Thankful for the Markets - Trading Journal 11.28.20

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Initial numbers for consumer spending during Black Friday was not lack luster but a bit concerning.

https://www.usatoday.com/story/money/shopping/2020/11/28/cyber-monday-2020-black-friday-sales-records-coronavirus/6449464002/

With the pandemic still a concern and more cases across the country it is understandable that brick and mortar stores would feel some pain, but -52% in sales compare to a year ago seems really bad. Then again stores had prolonged black friday deals for weeks to reduce in store crowds while a lot of spending happened before the big event. On top of that online sales rose 22% from previous year.

Yet reading the headlines and stories about this year's black friday had me thinking about the retail and commercial real estate. As of now in the area I am living in a lot of office rental areas are still vacant and most are partially occupied. The reality is many of these buildings are simply not nearly running at full capacity. This cascades into businesses bottom line. Less people at work therefore less business for restaurants, malls, and stores across the big cities. A domino effect occurs where government tax revenue is nose diving since the businesses are taking in less.

The bright side of this is the stock markets are near all time highs and it remains to be seen if a Santa Rally will be coming. All signs look positive and the market breath is a really good indicator to identify the potential of further gains.

S&P stocks above 100DMA market breath has turn to a higher high while prices barely rose. Bullish.

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S&P stocks above 50DMA market breath is rose as of last week and remains in a uptrend.

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S&P stocks above 10DMA market breath is also rising although currently Friday closed flat. Still longer DMA has more influence in the markets hence there is a base as to markets being more bullish.

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It remains difficult to ignore the current economic conditions as we are living through it day by day. However the stock markets are predicting what will be 6 months or more down the road and it appears things are looking brighter each day. With vaccines coming out sooner than expected and great test results I would have to believe at the very least the current virus will be under control by next year. What is uncertain is how quickly will the economy recover. Then again we should not predict and just follow where price action is leading us.

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