Big Picture

Our overall Primary Trend Indicator remains Positive.   We like the underlying trends forming for equities; negative yielding debt, robust consumer spending, central banks lowering interest rates in unison, and the upcoming holiday spending season should continue to support investor sentiment and "risk on" environment.

Changing Fundamentals

China Aug M2 Money Supply +8.2 Pct From Year Ago (Reuters Poll 8.1 Pct)

Spain Industrial Output NSA (Y/Y) Jul: 2.9% (prevR -1.8%)

U.S PPI (YOY) (AUG) ACTUAL: 1.8% VS 1.7% PREVIOUS; EST 1.7%

Focus List

 

Global Stock Markets are trending higher with Asia and Europe up on average 1%.  Bond Yields are stabilizing and turning up after weeks of declines.  Commodities are higher with WTI oil prices approaching $60 per barrel.  A 10:30am weekly report on US inventories will show whether the US continues to export oil out of storage, which has been the case for many months under a Trump administration.  Gold, Silver and Copper prices are all marginally higher on a weaker $USD.  Metals prices have sold off over the past 2-3 weeks, and present a good entry point for investors.

 

Stocks in Play:

Micron Technology $MU – The stock was upgraded to “buy” from “neutral” at Longbow Research, which points to improving pricing fundamentals in the memory and flash storage chip market.  Micron’s stock has rallied since the Trump administration banned US tech companies from working with Huawei.  Technical Analysis of price action shows a breakout to new 52-week highs on strong volume.  Multi year highs for the stock are at $61, our technology shows good probability the stock approaches $61 and tests that level, in the coming weeks.  On Balance Volume, Momentum and Relative Strength are all positive and rising.  Web Chatter is higher than normal, especially with todays upgrade.  Algorithms will integrate all these factors and likely add to the bullish underlying bid for the stock.

Ballard Power Systems $BLDP – The stock has broken out to new 52-week highs on 5 X’s average daily volume.   The growing usage of Hydrogen fuel cell technology is the main fundamental driver of the move higher.  By 2030, most G20 nations have plans to dramatically increase clean energy usage.  For Ballard, they are already a leader in fuel cell technology for buses and other industrial automation.  Technical Analysis of price action shows a big increase in volume on the breakout above resistance at $5.  On Balance Volume and Relative Strength continue to increase on this price increase, confirming the move.   Web Chatter is increasing on topics of Hydrogen, Fuel Cells and searches of Ballard Power.  Based on the data we have collected, we expect this move higher to continue.