Chapter 23
Top Ten Market Indicators You Should Monitor
IN THIS CHAPTER
Understanding the importance of market indicators
Identifying and monitoring the major indicators
Applying the data to improve your bottom line
The commodity waters can be perilous at times, and knowing how to navigate them is crucial. Keeping your eye on where the markets are heading — and where they’ve been — will help you develop a winning investment strategy. One way to identify where the markets are heading is to watch certain market indicators. The ten key metrics highlighted in this chapter offer insight into what the markets are doing and help you design and calibrate an investment strategy based on the market fundamentals.
Consumer Price Index
The Consumer Price Index (CPI), compiled by the Bureau of Labor Statistics (BLS), is a statistically weighted average of a basket of goods and services purchased by consumers around the country. The CPI is the closest thing to a cost-of-living index and is sometimes used to gauge inflationary trends. If the CPI is rising, economists — especially the ones at the Federal Reserve — start worrying that inflation is creeping up. A rising CPI may then result in an ...
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