The Gilmo Report

June 16, 2019

June 15, 2019

The major market indexes tracked sideways all week long as they tread water ahead of this Wednesday’s Fed policy announcement. The NASDAQ Composite Index spent the entire week building a five-day flag formation just below its 50-dma after two unsuccessful attempts to retake the line on Monday and Tuesday. Meanwhile, the S&P 500 Index is holding tight sideways in an identical five-day flag formation that is above its own 50-dma.

 

 

The indexes may remain in a state of suspended animation until the Fed decision is known. There are some expectations of a possible rate cut, and it is not clear what the market will do in response. It could be seen as an admission that the economy is weakening (by some measures, such as the Morgan Stanley Business Conditions Index, it is collapsing). Individual stocks, for the most part, continue to bide their time.

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