But, you know, bars and restaurants are doing really well. So are companies that sell building materials and automobiles. Hmm... I wonder what they have in common?? Oh yeah, folks don't go to Amazon to buy the stuff they offer. In fact, the companies whose stuff Amazon does offer---specifically, clothing, electronics and appliances, furniture, general merchandise, health and personal care and sporting goods---are losing 24.3% of their sales to the online behemoth! Yep, if you belong to one of those eight categories, that's a serious hit to your bottom line.
While folks are indeed buying more from Amazon (Q1 revenue up 28.22%) and less from Macy's, JC Penney and Norstrom (-7.4%, -1.61% and +1.06% respectively), they're really enjoying those savings at the gas pump --- Priceline and Expedia (online travel agencies) saw their revenues rise 16.7% and 38.63% respectively, and Netflix enjoyed a whopping 24.45% increase.
I'm just not feeling all recessiony right about now...
So what's giving the market the blues? Well, while, again, I'm not feeling all recessiony, I can't say I'm feeling all warm and fuzzy either. In fact, as I've been illustrating in my weekly videos, I'm fairly gloomy over the very near-term. And that would be about seasonality; here's a heat map showing the average per month performance of the MSCI World Index over the past 5 and 10 years: click each chart then wait a second and click again to enlarge...
![5 and 10-year seasonality](http://www.betweenthelines.us/wp-content/uploads/5-and-10-year-seasonality-1-300x28.jpg)
Yep, sell in May and go away, as they say! Well, not so fast! If you do and the average doesn't occur, you could end up doing some real long-term harm to your bottom line. Here are the monthly highs over the past 5 years:
![5-year high seasonality](http://www.betweenthelines.us/wp-content/uploads/5-year-high-seasonality-300x13.jpg)
And here's a look at the best monthly results over the past 10 years:
![10-year high seasonality](http://www.betweenthelines.us/wp-content/uploads/10-year-high-seasonality-300x13.jpg)
Nah, better to stay the course --- if you have more than a two-month time horizon that is.
It would also be about the technical setup. Here's a cleaned up look at some of what I've been showing you on the videos:
![macd](http://www.betweenthelines.us/wp-content/uploads/macd-300x217.jpg)
Panel 2 shows us the Moving Average Convergence Divergence Oscillator (MACD). While, in different ways, this momentum indicator offers up signals to short and longer-term traders, I find it most predictive when its path diverges from the general price trend, as it began to in late March. The S&P 500 closing below its 50 day moving average (green line in panel 1) on Friday doesn't help either.
And of course there's the prospects for a Fed rate hike(s) this year, which has the market a bit anxious. And you can see why based on how stocks responded to the Fed's stab at it last December:
![December rate hike](http://www.betweenthelines.us/wp-content/uploads/December-rate-hike-300x217.jpg)
Then there's "Brexit" (the June 23rd Great Britain referendum on whether or not remain in the European Union). Here's the latest poll result:
![Brexit poll](http://www.betweenthelines.us/wp-content/uploads/Brexit-poll-300x117.jpg)
While---despite what you see above---I seriously don't see Brexit happening, the market could experience some serious volatility leading up to it. Particularly if there's no clear sign of nogo going in.
Beyond all that short-term stuff (there's of course more we could delve into, positive and negative), I feel very good about owning the world's great companies (in balanced, diversified fashion) on behalf of our patient, eating, drinking, traveling, home-improving, car-driving, Netflix-watching, online-buying, long-term-thinking clients.
Have a wonderful weekend!
Marty
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