Euclid Investment Advisory Blog

Review & Analysis at Close October 31, 2022


Monday was a relatively quiet day ahead of a big week of potentially market-moving news and events. The Federal Open Market Committee begins a two-day meeting tomorrow, with a policy decision scheduled for Wednesday afternoon. Officials are widely expected to increase the fed-funds rate target range by 0.75 percentage points, to 3.75% to 4.00%.

The Bureau of Labor Statistics releases tomorrow the jobs openings and labor turnover survey. Also tomorrow the Institute for Supply Management releases its manufacturing purchasing managers’ index for October. Then there's the Jobs Report on Friday: The U.S. economy is expected to have added 195,000 nonfarm payrolls in October, down from 263,000 in September. And next Tuesday, November 8th, is the mid-term elections.

Weekly Market Breadth indicators improved having moved off the bottoms of their respective ranges. VIX fell for the week closing at 25.88.

US markets and Europe pulled back today after rising for the week. China fell again today. All markets remain in their strategic long-term downtrends.

However, daily charts show short-term promise: the S&P 500, Russell 2000, Nasdaq Comp., and Europe have signaled value zone buys for swing traders.

For last five days, Real Estate rose 6.9%, Industrial +4.98%, Utilities +4.61%, Technology + 1.44%, Consumer Discretionary +0.73%, Communication Services fell 4.53%

The 10-year US Treasury Yield rose slightly today to 4.077%, down from recent peak of 4.333%. The rate's rise may pull back here from overbought.

The 2-year US Treasury Yield rose slightly today to 4.51%, down from last week's peak of 4.62%. The 2-yr yield's rise remains parabolic.

The 10-2 year Yield Curve remains inverted, with its spread widening to -0.41 and moving in a sideways channel.

Currencies vs. US Dollar: The Australian Dollar, British Pound and Euro all continue Bearish trends vs. the US Dollar. The Bearish Yen weakened further.

The bullish US Dollar pulled back to 111.42 from very overbought and remains in a long-term uptrend.

Gold remains in a Bearish trend. Base Metals and Copper remain in Bearish trends as is West Texas Light Crude Oil, closing at $86.53.

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