Jackson Pollock-abstract expressionist painter
At the Museum of Modern Art in New York, curators viewed One: Number 31,1950 the way that Pollock painted it-laid horizontally. This provided a rare and fresh perspective. As such, the scale became more readily understood.
In the spirit of changing perspective, we officially began stock trading 2017.
Pollock would fling his arms in sweeping gestures. He controlled where the paint would be thick and where it would form fine, thin lines.
This year, unlike any before it, our new President, abstract expressionist if you will, tweets. One broad stroke of Trump’s paint can send General Motors (GM) sinking and Ford Motors (F) sailing.
With Presidential tweets to consider, the noise will be palpable. It is our job to view the market like we view an abstract painting. Find a thread and keep the noise at bay.
How can we make the market’s potentially abstract scale more readily understood?
If curators find laying a Pollock horizontally a key to comprehension, we traders must think similarly.
As we know, the market fares better with stability. Determining how unified or disparate the Modern Family sectors are will help.
Beginning with the Russell 2000, we see a trading range. Last week (and so far this week’s) low is an excellent vantage point to see whether the small caps interpret the new administration as one that will make broad or thin strokes in changing policy.
From there, Transportation must hold its current bullish phase. Yesterday, it closed down 1/4%.
On day one, Regional Banks, a pillar to evaluate how confident the market is about an improving economy, traded with some uncertainty.
Semiconductors also traded with uncertainty although, with more of a touch of thinness.
Retail began the year trading inside two key moving averages-the 50 and 200 simple daily ones. That implies even more uncertainty. Biotechnology rallied, yet remains in a bearish phase.
