There is a whole lot of Chaikin going on! In todays blog post we are continuing the series about technical analysis and the large toolbox of indicators available. Today we are looking at an indicator that attempts to measure money flows into and out of a security.

The Chaikin Money Flow was created by Marc Chaikin along with the Chaikin Oscillator and Accumulation/Distribution signals to measure the flow of money into or out of a security over a given period of time.

The Money Flow Volume was conceived by Chaikin to measure the buying and selling pressure for a security over a user defined period of time such as 15, 50 or 200 days. The most popular setting for this indicator is over a 20-21 day period. The value of the oscillator swings between 1 and -1 with buying pressure being greatest when the value is closest to 1 and selling pressure being greatest when the value is closer to -1.

The exponential rise in the national debt since COVID began by the tune of more than $3.8 Trillion of stimulus monies was inevitably going to lead to a wave of hard asset inflation as well as consumer inflation. The only question was "how much"?

In the last couple of days, the markets woke up to the fact that inflation might be worse than the federal reserve predicted. The CPI (Consumer Price Index) numbers released for April 2021 rose 0.8% versus an expected rise of 0.2% month over month. Should we be alarmed and worried? In the short term, the answer is "not really". If you have been tracking first quarter earnings calls, you will have heard many CEO's describing how tight supply chains are right now. Higher costs of raw material inputs are being passed onto the consumer. As COVID restrictions ease and consumer demand for goods and services rise alongside tight supply chains operating on "just in time" demand cycles, the natural consequence of greater demand and tight supplies is higher price increases.

It is difficult to say how inflation numbers will fare over the coming months as it will take time for supply chains to re-calibrate and meet rising demand.  However, as this occurrs, inflation numbers will likely decrease as supply increases. Overall, however, we expect the inflation trend to show up as net higher consumer prices across most hard and soft asset categories, compared to before the pandemic.

Joe Biden announced his new trillion dollar infrastructure plan last week and how he intends to fund it, which sent chills through the markets and the $400,000 plus annual income earners. Of course, this should not have come as a surprise. The odds of the Biden Administration not implementing such a key campaign promise was close to zero. What the announcement did do was sound the alarm ammong the top segment of american earners that it was time to take action and evaluate steps to mitigate taxes going forward under the likely scenarios outlined by the president.

The actual proposal however still needs to pass the chambers of congress and the resulting outcomes will not be known until it does. It is likely that the proposed announcement of a hike on income and capital gains taxes was a negotiating tactic and it would be unlikley that long term capital gains would be as high as the 39.6% proposed rate and more likely to be sub 30%. In addition, it is anticipated that there will be an increase in estate and gift taxes which will also require heirs to pay capital gains taxes on assets above a certain amount that they inherit.

The cosy tax rules governing asset inheritances which has allowed wealth to be locked up generationally without taxes needing to be paid on any assets held for the long term looks likely to change. The Biden infrastructure proposal needs funds to pay for it and just adding to the national debt to pay for it is not a solution. In a predominant capitalist society the spoils of industry and most advantageous tax rules go to the few while comparatively much larger segments of the population live on sub $15/hour wages and are unable to cover the increasingly expensive needs of life.The middle classes are shrinking and the working classes have felt left behind.The new Biden Tax plan aims to address some of these imbalances.

This week, we are going to continue with our "key technical indicators" series for stocks or any publicly traded instrument for that matter. Today, we are going to explore "Bollinger Bands".

Bollinger bands are a volatility indicator that depict two deviations from a moving average in the price trend of a stock, commodity, fund etc. This is depicted as two lines on either side of a moving average indicator which represent the outer (upper and lower) bands from the moving average. When a stock, on the upside, rises above the outermost upper band as in the chart on the left this can indicate the stock is over bought and may be an opportune moment to sell. Likewise, if the price trend falls below the outermost lower band, it can indicate the stock is over-sold and may be an opportune moment to buy.

As with any technical indicator, these can be used over different trading timelines whether this is intra day, daily, weekly, monthly or any timeframe you may choose. Their relative significance will also vary by the timeline you choose and as always are useful to use in combination with other technical indicators and values.

Over the coming months we will discuss a variety of stock indicators and how these can help an investor identify market cycles and significant shifts in market or company fortunes. Investors have different time horizons which can vary from 1 day to 30 years. Regardless of the investment timeframe, you must determine an entry and exit price which may or may not sync with your investment timeframe.

Stock market indicators can help identify market trends, volume, volatility and momentum across different timeframes. The longer the timeframe e.g. days, weeks or months over which one can measure results, the more consistent the resulting patterns and analysis will be. If you are trading intra-day then the bigger investment picture or outlook for a company, commodity, fund or ETF is hardly relevant. Chart indicators however can be helpful regardless of timeframe.

In this article we will examine the MACD or Moving Average Convergence Divergence indicator. This indicator can help identify shifts in trends in price both to the up and downside.