Charts Give Reason to Worry About Consumers
As the indicators continue their march sideways, let's check in with the consumer to see if the kids are alright.
You're reading 0 of 1 free page.
Register to read more or Unlock Pro — 50% Off Ends Soon
We do not have any change in the indicators. I really wanted to report a change to you. I wanted to show movement. More new highs, heck, even more new lows. But I can’t. The only thing that changed was the SOX broke out to a new high. But it continues to lag the overall Nasdaq.
Oh, and the Utes rallied, having had their best day in a month. They will run into some trouble in that 1100 area on the first trip up there, but overall, they have bounced from where they were supposed to.
I was so focused on the Utes this week that I forgot to note that OIH has been outperforming XLE since the calendar turned to September. Not by a lot, but long-time readers will know that I tend to like it when the higher beta (OIH) outperforms the lower beta (XLE). It's like the SOX outperforming the Nasdaq. It’s been in an uptrend since May, but the trend has been pretty rocky.
I know everyone is so excited over the AI stocks, but I have had my eye on some consumer-focused names. The restaurants are really struggling. I thought Chipotle CMG would stop sliding around 40, and it barely took a breather.
Starbucks has its issues, but even so, this once former favorite stock is now the lowest it has been since May.
The once hot Cava CAVA gapped down a few weeks ago and hasn’t been able to muster an oversold rally.
Then McDonald’s MCD, which had been flirting with new highs, gave way on Wednesday. It has held this uptrend line since July. It’s got support all the way down, but the stock is down five percent in the last few days. I would remind you that the retailers told us last week the consumer is in good shape.
Naturally, this brought me to Marriott MAR, which is well off its early 2025 high, but now is that a head and shoulders pattern I see developing between May and now?
I don’t know if JB Hunt’s JBHT action is related to retailers and the consumer, but I do know that it had better hold 135 or a visit to the April lows is coming.
There is a reason the bonds are rallying, and I think these charts are telling us to pay close attention to the consumer. Or maybe we’ll just survive on AI. And Utes!
