Stocks A Bit Tired But Not Sick At All
The rally off of the historic Christmas low has been nothing short of amazing. It’s only now that folks are realizing its magnitude and power. Stocks still have not done anything wrong, but are certainly a little tired. I will have more on my upcoming issue, state of the market, either later today or tomorrow. Stock index leadership has healthily rotated during the rally and now we have the NASDAQ 100 and Russell 2000 leading. That’s a good thing. Semis […]
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Date: February 5, 2019
MONSTER Jobs Report, BUT…
As I sat down to craft today’s piece just after the January jobs report was released, I found myself sidetracking from the short-term reaction to the report to a sort of state of the markets if you will. So, I went with it, writing for several hours on where stocks stand today. I will publish that early next week. Today, I was shocked when I heard that the economy created more than 300,000 new jobs in January, almost double what […]
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Date: February 1, 2019
Markets Not Waiting on Fed Statement Today
Powell Turns 180 Degrees and Loses Credibility Fed statement day is here once again. Yippee! Chair Jay Powell did something I don’t think I have seen in 30 years in the business. He did an almost 180 degree turn in just three weeks after raising rates and forging full steam ahead with more asset sales on December 19. When the markets, both stock and credit, accelerated to the downside, Powell eventually walked back his very hawkish stance to try and […]
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Date: January 30, 2019
The “Easy” Trade in Apple
On January 3 Tim Cook shocked the investment by pre-announcing earnings problems and slowing iPhone sales. Fundamental analysis is above my pay grade so I am not going to go any further. It was shocking because I couldn’t find any other pre-announcement since 2002. There may have been one, but it wasn’t easily found. The stock had already collapsed from $233 to $147 before the warning. That magnitude, 37%, is not what you normally see even during a 20% decline […]
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Date: January 30, 2019
Semis & Junk Bonds Say the Bears Are Wrong
After trying to score new recovery highs late last week, stocks are set to open modestly lower to begin the week full of earnings and the first FOMC meeting of the year. For now, I am sticking with the same theme from last week. The market is in pause or pullback mode. So far, stocks have done nothing wrong. Leadership has been strong and constructive with all four key sectors contributing. I have to say; behavior in the semis is […]
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Date: January 28, 2019
Risk in Both Directions is Small
In Monday’s post, I briefly discussed “V” bottoms and their rarity. I also mentioned that stocks had come very far, very fast and that a pullback or pause was due right about now. So far, stocks have perfectly paused and mildly pulled back. If the rally from the Christmas low remains fully intact, the pullback should be over with either some additional sideways action for the market or a return to new recovery highs next week. It’s that easy right […]
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Date: January 24, 2019
“V” Bottom But Pullback Due Right About Now
Stocks closed at their highest levels since December 6th on Friday, wiping out 100% of the vicious and relentless selling wave I wrote about for so long. So far, the bottom has had the shape of a “V” which is not only rare, but generally uncomfortable for me as “V” bottoms are more characteristic of bear market than bulls. To counter that, there have been numerous confirmations that the rally since the Christmas low is a blast off of a […]
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Date: January 21, 2019
Bulls Continue to Do Nothing Wrong, Yet
Stocks continue to do nothing wrong as they bounce sharply from the epic selling wave in December. On Tuesday most of the major stock market indices made new recovery highs. Leadership has been constructive, meaning the more aggressive sectors have been leading. Risk on, if you will. However, stocks have also rallied right into the zone I first mentioned on December 21 as the most logical area where the bears could put up a fight. From here we will see […]
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Date: January 16, 2019
Equilibrium or End of Rally?
Almost on cue, stocks began to either stall out or moderate as they entered the lower end of the zone I first offered on December 21. That is a logical place for some to takes chips off the table if a revisiting of the Christmas lows is going to happen sooner than later. So far, stocks have done nothing wrong, especially with high yield bonds and bank loans snapping back so strongly in 2019, but I am not going to […]
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Date: January 14, 2019
Stocks into Zone Where Rally May Stall or End
It’s been one heckuva start to 2019. Just listen to the media and pundits tell you how stocks have rocketed 7, 10, even 12% since Christmas. While that is true, it’s a bit misleading as they forget the carnage from Q4. As I wrote about here and here late last year, there was certainly a preponderance of evidence to suggest a bottom and vicious bounce. That has come to fruition and I am glad the market is cooperating with the […]
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Date: January 11, 2019
