Trump: Middle-class tax cut to be proposed in 90 days | Technical analyst says earnings season may signal market peak | CMT tips homebuilding ETF to make gains on back of boom
January 22, 2020
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Trump: Middle-class tax cut to be proposed in 90 days
President Donald Trump says his administration's proposal for a "fairly substantial" middle-class tax cut will be released in 90 days. He has declined to offer details of the proposal.
The Hill (1/21),  The Wall Street Journal (tiered subscription model) (1/21) 
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Technical analyst says earnings season may signal market peak
A round of strong earnings reports has helped US stock markets to maintain their ascent and technical analyst Chris Vermeulen says there is every likelihood of the rally continuing, but there is also evidence of an imminent peak. His customized weekly chart shows a defined price channel that could develop into a key line of resistance in the coming weeks, which could prompt a reversal.
Technical Traders (Canada) (1/20) 
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Industry News
CMT tips homebuilding ETF to make gains on back of boom
A 13-year high in US housing construction starts has helped the iShares U.S. Home Construction exchange-traded fund to surge ahead of the S&P 500 over the past 12 months. Despite strong inflows, technical analyst Craig Johnson, CMT, CFA, says the fund is not overbought and has capacity to keep rising, and he singles out PulteGroup as an individual entity that looks particularly capable of a breakout.
CNBC (1/21) 
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Netflix posts first year with over $20B in revenue
The latest Netflix earnings report shows the company has generated more than $20 billion in yearly revenue for the first time. That feat took Disney 74 years, compared with Netflix's 22.
BNN Bloomberg (Canada) (1/21) 
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US health care, tech stocks could struggle in election year
Technology and health care stocks tend to underperform against the S&P 500 in election years, according to analysis from Dow Jones Market Data. Currently, the strength of the wider US economy is bolstering stock prices while the health care and technology sectors face political headwinds.
The Wall Street Journal (tiered subscription model) (1/21) 
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IBM well equipped to make significant ascent, says CMT
Writing ahead of the release of the IBM earnings report, which showed a return to revenue growth after five quarters of decline and prompted a 5% jump in its share price, technical analyst Bruce Kamich, CMT, predicted a positive future for the company. Indicators including its on-balance-volume lines and moving average convergence divergence oscillator are showing signs of improvement and Kamich says it could rise to to an upside target of $201.
Real Money (tiered subscription model) (1/21),  CNBC (1/21) 
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Virus outbreak sends airline stocks tumbling
Fears that China's coronavirus outbreak could reduce global air travel have driven down shares of Delta Air Lines, United Airlines and American Airlines. The major concern is the disease could spread beyond Wuhan, China.
CNN (1/21) 
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Market Structure and Regulation
Central banks look at issuing cryptocurrencies
The European Central Bank and the Bank of England say they and other central banks, with assistance from the Bank for International Settlements, are jointly reviewing potential benefits of issuing digital currencies. BoE Deputy Governor Jon Cunliffe and former ECB official Benoit Coeure are leading the study.
Reuters (1/21),  City A.M. (London) (1/21) 
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Association News
Journal of Technical Analysis: "When To Buy and When To Sell"
In this article, authors Ned Davis and Steve Lackey discuss some of the steps involved in building a stock market model. Although they do not resort to arcane mathematical language, they nonetheless conclusively demonstrate that standards of proof and empirical testing are necessary in the building of such a model.

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Journal of Technical Analysis: Financial Manias
This paper is about financial manias -- economic events rather than market events. From reading financial market history as a technician, I noticed certain economic patterns seemed to precede financial manias. While financial manias were relatively infrequent and the preceding patterns not absolutely precise, as are most technical patterns, the recurrence of economic and political events was so consistent that it formed the basis for a technical theory of financial manias.

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