The Market in March: Maddening

 | Mar 17, 2017 | 4:16 PM EDT
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If it wasn't for a two-hour rally following the Fed interest rate announcement on Wednesday afternoon, the indices would have been completely dead this week. There was a brief celebration based on the view that the Fed was more dovish than expected, but after that the momentum completely dried up.

There were four very narrow range days where the indices barely budged. We did have some better breadth at times and the small-caps exhibited some relative strength, but the market was unable to build on the idea that the Fed was dovish. There were some momentary rallies in gold and interest-rate-sensitive stocks, but that fizzled fast. Bonds rallied and the dollar weakened, but it was fairly minor movement.

So far in March, the market has failed to build on two rally attempts. There hasn't been any rush for the exits, but the inability to generate better momentum is troubling. On the other hand, the bears are even more incapable and can't do anything when given an opportunity.

The bears continue to grow louder about how a slew of negatives are lining up, but the price option has refused to cooperate. There are some cracks appearing in the foundation, but rushing to play defense has been a costly endeavor in this market.

We are heading into a period where seasonality starts working against the bulls and there aren't any earnings catalysts. The next big market mover is likely to have something to do with whether Trump fiscal policy is making any progress. So far it's been all talk, but at some point the market is going to demand some progress and that will be when the market reacts.

It is weakening but the trend is still up.

Have a good weekend. I'll see you on Monday.

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