US Housing Starts; ASX Advance
By Colin Twiggs
April 28, 2017 9:30 p.m. ET (11:30 a.m. AEST)
Disclaimer
Please read the Disclaimer. I am not a licensed investment adviser.
Another short newsletter. I will return to the usual, longer format next week.
The latest GDP update shows the economy continues to grow, albeit at a moderate pace. The graph below compares nominal GDP (before adjusting for inflation) to total nonfarm payrolls multiplied by average weekly earnings.
![GDP GDP](https://www.incrediblecharts.com/images/2017/2017-04-28-gdp.png)
Light vehicle sales are slowing, suggesting that consumers grow more cautious.
![Light Vehicle Sales Light Vehicle Sales](https://www.incrediblecharts.com/images/2017/2017-04-28-lightvehicles.png)
But housing starts continue to climb, recovering above 1.2 million (privately owned) units for the first time since 2008.
![Housing Starts Housing Starts](https://www.incrediblecharts.com/images/2017/2017-04-28-housing.png)
The Philadelphia Fed Leading Index is rising, suggesting healthy growth in the 12 months ahead.
![Philadelphia Fed Leading Index Philadelphia Fed Leading Index](https://www.incrediblecharts.com/images/2017/2017-04-28-leading.png)
And a soaring Freight Transportation Services Index flags strong economic activity.
![Freight Transportation Services Index Freight Transportation Services Index](https://www.incrediblecharts.com/images/2017/2017-04-28-freight.png)
The economy appears on track for further growth. The biggest threat is that inflationary pressures rise and force the Fed to adopt a more contractionary monetary policy. But there is little sign of this at present.
Australia
The ASX 200 recovered above 5900, respecting medium-term support at 5800. Rising Twiggs Money Flow flags strong buying pressure and breach of 6000 now appears likely.
![ASX 200 ASX 200](https://www.incrediblecharts.com/images/2017/2017-04-28-xjo.png)
* Target medium-term: 5800 + ( 5800 - 5600 ) = 6000
It is easier to make our wishes conform to our means than to make our means conform to our wishes.
~ General Robert E. Lee