Sony Takes a Nosedive

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Yesterday we highlighted that Sony had disappointed investors with weak earnings and lowered guidance. Today the stock is down 11.7% and the chart looks about as ugly as they get. Below we show the absolute price point & figure chart in USD.

Homebuilders Extend Downtrend on Taper Concerns

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US homebuilders are back under pressure today as fears over Fed tapering are renewed. Our relative strength point and figure charts show a group that has rolled over and is in the early stages of a downturn.  It is quite possible the homebuilders retrace the entire move off October 2011 lows.  Charts are below.

Taper Trade Back In Play

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The taper trade appears to be back on this week.  Some of the basic symptoms of this trade are: 1) higher interest rates, 2) higher US dollar, 3) lower gold and 4) weakening stocks.  Charts below showing the last 10 days of activity reveal this sequence.

Staples: An Interesting Retail Stock

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Per some of our previous posts, it is getting harder and harder to find interesting large-cap consumer discretionary stocks. Many of the well known retail concepts like Target or Nordstrom are breaking down, while some of the luxury names, like Coach or Ralph Lauren are locked in persistent declines.

Mixed signals coming out of the US

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There doesn’t seem to be a trend in the US economic releases recently. In the past week we have had weaker housing data (Pending Home Sales), an ok production data point (Industrial Production), below consensus employment report (ADP), a weaker regional survey (Dallas Fed), and now today a blow-out regional survey (Chicago PMI).