Morning Stock Market Call (VIDEO)

We wanted to do a quick review of our thoughts on stocks, bonds, gold and the dollar this July 3rd morning.
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Morning Call Video

video


LONG TERM BULL MARKET IN THE MAKING

Bull Market 2017
Source: Macrotrends

To the left you have a century of Dow Jones trading action here. We've had two 16-17 up-cycles and we could be in the third. We've had the breakout as confirmation.

EQUITY COVERAGE
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S&P 500: BULLISH 
Today is a half day. Markets close at 1PM.
There is seasonality that hits markets into July 4th and historically can make a low for the year. (See here)
We're excited about speaking to companies because it helps a lot to have a feeling what's going on at a company level in the economy. Businesses are doing well and gradually picking up globally, in general which is a great reason for markets to be bullish.
As for SPY, we really like our May 22nd medium term entry on the long side. We have some conviction that the level can hold for the year.  That's a big call. We'll see.
GOLD: Turning Bearish
We're turning short term bearish on gold. Using the ETF GLD there is a break of the uptrend. The economy and earnings have been picking up. The Fed is also being hawkish despite weak inflation data in CPI and PCE Price (Friday's report). Higher rates and low inflation are not gold's friend.

If our bearish call is correct it may also hint that equity markets want to go higher.
BONDS: BEARISH
Bonds should be going down. There will be a battle because many Baby Boomers are not getting rid of their bonds so fast. Plus inflation has been weak and many still aren't sold on the economic pickup sustaining.
In the meantime we love the rejection of the breakout. We think that's meaningful.
We are of course also more bullish than most that the economy is going to sustain a multi-quarter, maybe multi-year uptrend.
DOLLAR: NEUTRAL 
We had a decent stop loss in the dollar because it's kept going lower. We have no opinion except maybe it’s over done but it's not our style to buy securities that are falling.


By: Chaim Siegel, Elazar Advisors, LLC

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