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Market Rally Test

2/19/2016
By Charles Payne, CEO & Principal Analyst

Oil continues to hold up on hopes that major producers stop destroying one another as the airlines used to in this country; remember Air Pennsylvania or Frontier Air, there are over a hundred gone since 1979.  Although it doesn’t mean a snapback rally, a relative calm helps the market.

Moreover, if there were any cuts in production, there would be a massive snapback perhaps to $40+.

The dollar chart hints at the greenback moving lower, and that’s good news for corporate profits.

The Dollar Index (DXY) began pulling back from a double top late last year, and it is now making a series of lower highs.

Consumer stocks continue to come on strongly with yesterday’s biggest winners being Fossil (FOSL) that lost less than expected.  Apple (AAPL) didn’t kill the company’s watch business, but I will say Europe was the bright spot. Priceline (PCLN) was has also been a huge winner, but it was all about international business, which is fine, as global consumer strength, has been questionable.

However,  it’s now the big technical test; the Dow must clear 16,500 and for the S&P 1,950 would be monumental, particularly if accompanied with strong volume.  From there, the S&P has a clear shot to 2,000, perhaps even much higher.

 

 

Charles Payne
Wall Street Strategies


 

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