Dogs In This Fight-Bulls, Bears And Agnostics

Black Friday and Cyber Monday posted record sales.

Yet Amazon AMZN, and many of the retail stocks that saw huge gains last week, today fell.

The brick and mortar retail ETF XRT, on alert for a move higher, also dropped by over 1%.

In other news, while Americans blissfully bought multiple items on sale thereby increasing their household debt, many other areas of the globe continue to revolt against oppression.

Rising food and raw material prices have soared, particularly in emerging markets.

That has widened the gap between the wealthy and the masses in many of these revolting countries, most notably throughout Central and South America.

To add to the disconnect between the sentiment of the U.S. and elsewhere, the Federal Reserve stated today that they are considering raising the optimal inflation rate of 2% to higher.

So while petrol, food, and minerals show massive inflationary signs outside of the U.S., inside the U.S., the Fed’s metrics continue to point towards lagging inflation.

That brings us back to the U.S. stock market.

Given strong U.S. consumer sentiment against a much angrier world sentiment, which dog are you in this proverbial fight?

A bull, bear or agnostic?

(Click on image to enlarge)

If you choose bull, then these charts support that position as both are above key weekly moving averages.

Amazon sits above the 50-WMA (blue line).

XRT sits above the 50 and 200-WMA (blue and green lines.)

Therefore the bulls in this fight can say with authority that both instruments are holding support.

If you choose bear, then these charts support that position as well.

On a day that kicks off seasonal buying in retail, especially given the strong cyber sales, Amazon’s decline in price shows a weak price reaction realtive to strong news.

XRT, with its pattern of lower highs since July 2019, also emboldens the bears, as this pattern has yet to negate.

If you choose agnostic, then these charts equally support that position.

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