A Good Start To 2021: Weekly Nifty 9 Charts In Focus

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This is the fastest moving average for studying market breadth strength and presently over 76% of S&P 500 stocks are trading above their 10-DMA. Can the percentage move higher? Clearly, the indicator suggests it can, but I would be keeping a watchful eye on that 80% level, which may indicate some of that volatility mentioned previously is about to commence. Not a prediction, but rather something to anticipate and take advantage of should it unfold. 

Research Report Insight #4

ISM’s Manufacturing PMI for the month of December was quite strong. For the seventh month in a row, the index was consistent with growth in the manufacturing sector. Not only did the ISM’s reading show yet another month of growth, but that growth accelerated as the index rose to 60.7. This was the highest level since August of 2018, as the trade war began. Prior to that, you would need to go all the way back to January and May of 2004 to find readings as high as this past month.

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  • “Our company and industry are continuing to have tailwinds from the COVID-19 pandemic research support for vaccines and treatments. While our services are delayed, many customers are not canceling outright, and business picked up for us in the last month — especially in China, where business growth is back on track.” (Computer & Electronic Products)
  • “Continued to survive COVID-19 shutdowns, customer restrictions and personnel issues (work from home and COVID-19 outbreaks) and managed to maintain slight growth over 2019.” (Chemical Products)
  • “COVID-19 outbreaks are causing supply chain issues for Tier-1 and Tier-2 suppliers. More work needs to ensure suppliers keep us in the loop with any problem in their supply chain. But end-customer demand for products is keeping production and future outlook positive.” (Transportation Equipment)
  • “COVID-19 is affecting us more strongly now than back in March. Vendors/service suppliers unable to maintain levels of service due to employee shortages. Logistic issues also hurting us due to coronavirus-related problems.” (Food, Beverage & Tobacco Products)
  • “Current business outlook is strong through the first quarter of 2021. We are anticipating 20 percent growth in sales for 2021.” (Fabricated Metal Products)
  • “Sales are now slightly above pre-COVID-19 sales.” (Machinery)
  • “Sales are now exceeding pre-COVID-19 levels, but uncertainty remains through the winter months while COVID-19 is still rampant.” (Miscellaneous Manufacturing)
  • “Business is stronger than expected, with higher demand for many products. Volatility continues due to the very persistent pandemic and associated risks.” (Electrical Equipment, Appliances & Components)
  • “Suppliers are having difficulty finding and retaining labor leading to supply constraints.” (Plastics & Rubber Products)
  • “Fourth-quarter production improved more than anticipated, both against the rolling forecast and compared to typical Q4 business.” (Primary Metals)
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