Tuesday, May 24, 2011

Market comments for May 24th

Today I have added a little something different to the mix. I have found an interesting piece of news about the economy and where we are right now that I thought I should repost here. It is from Haver Analytics and includes a chart. Here it is and the title:

Chicago Fed Index Provides Further Evidence of Momentum Lost

The list of indicators suggesting that the economy's forward momentum has waned continues to lengthen. The Chicago Fed reported that its National Activity Index (CFNAI) retraced its earlier improvement and fell to -0.45 in April from a little-revised 0.32 in March. The three-month moving average of the index, which smoothes out some of the series' volatility, slipped to -0.12, the first negative reading since December. During the last ten years there has been an 81% correlation between the index and the Q/Q change in real GDP.

To read the entire article on Haver Analytics click here.

While yesterday's market was down and broke below the previous support line, as seen in yesterday's post on the Dow, the final Volume for the day was not that strong and indeed was less than the previous day's volume. Given this fact, today's market may bounce up somewhat, as Futures indicate. Watch today's volume for clues as to future direction.

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