5 Signs That Indicate If Trade Tension Are Getting Better or Worse

Independent macro and options research, published every trading day — $85/mo or $750/yr

August 26 – Stock mentions: SPY, FXY, VXX, AAPL, TLT, SLV

Michael Kramer and clients of Mott Capital own AAPL

US Markets

S&P 500 Futures +75 basis points
US 10-Year 1.52%
US 10-Year minus US 2-Year +0.004%
Oil $54.83
Dollar Index 97.96
VIX 19.80

International Markets

Shanghai -1.17%
HSI -1.91%
KOSPI -1.64%
Nikkei -2.17%
Germany +0.57%
UK -0.47%

Stocks are moving higher this morning after news broke early today that the US and China are heading back to the table to talk trade. In all honesty, to make an investment decision based on all of this back and forth is nearly impossible.

The one significant takeaway that continues to hold is that a lot of these significant downdrafts in the markets on China worries one way or another result in a recovery. I think the primary reason for this is that President Trump very much cares about the stock market and its performance. As long as that remains the case, I think the declines are some insulated. (See: Your Survival Guide To The Week Of August 26)

S&P 500 Futures (ES)

We can see that the futures are sharply off their lows. Also, notice how the futures on the S&P 500 did not make new lows. This is a similar pattern to what I noted over the weekend in other asset classes.

S&P 500 (SPY) Cash

However, for the S&P 500 cash resistance will hover around 2872, and then the 2900 region.

Dollar/Yen (FXY)

One sign that tensions are easing will be to watch the Dollar/Yen. The Yen is weakening today rising back to around 106. As I tell my subscribers regularly, a yen that is falling towards 100 is strengthening and indicting fears are rising. Meanwhile, an increase towards 110 indicates that fears are easing.

VIX (VXX)

The VIX needs to continue to fall and as long as it stay below 20, there is a chance it moves lower towards 17.5, which should help to lift equity prices.

Apple (AAPL)

Apple is one stock that is a must-watch with resistance at $209.50.

Silver ETF (SLV)

Silver is pushing over $16.40 and could be pushing towards $17.25

iShares 20+ Year ETF (TLT)

I also continue to believe that TLT is heading lower towards $135.

Good Luck today

-Mike

Michael Kramer publishes independent macro and options research read across 10+ platforms and by institutional desks. For research syndication, licensing, or consulting inquiries, visit michaeljkramer.com.

Mott Capital Management, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Past performance is not indicative of future results.

This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.