Healthy Pullback & Unimpressive Bounce So Far
I noticed that the S&P 500 has been down four straight weeks while still in an uptrend. That doesn’t happen all that often, but it is a plain vanilla pullback in a bull market. From peak to valley on a closing basis we have seen the major indices correct: Dow Industrials -6% S&P 500 -8.50% S&P 400 -8% Russell 2000 -10% NASDAQ 100 -12% When we downgraded our 1-3 month market view I said I did not expect a 10% […]
Read More
Date: August 12, 2024
Aftershocks Continue – Looking For Volume & Great BBQ
After Monday’s earthquake we saw a solid aftershock on Wednesday as stocks gave up a big bounce back gain to close moderately lower. Thursday reversed the reversal with 85% of the trading volume coming on stocks going up on the day, a good sign. However, as you can see in the chart below all the way on the right, the rally has come on diminishing volume which is a warning sign. Another “however”, this is not unusual. It’s the next […]
Read More
Date: August 9, 2024
Monday Was An Earthquake – Aftershocks Coming & Then All-Time Highs
Monday changed a lot of things in the stock market. You can call it a mini-crash or a woosh or an earthquake. One thing is for sure, days like that, especially after historically low volatility regimes, can shake investors’ confidence to the core. People react emotionally and usually not in a good way. They sell when they should be holding or buying. My thesis has been very clear. We downgraded the stock market over the 1-3 month period. We sold […]
Read More
Date: August 7, 2024
Bad News Is Now, Well, Bad News – Markets Manic
On Friday, the employment report showed a gain of 114,000 new jobs in July. The unemployment rate rose to 4.3%, its highest level since October 2021. Both were weaker than expected. However, market reaction was a whole lot worse than those numbers would have indicated and that suggests more selling on Monday, perhaps even high magnitude selling. For all those crying for a rate cut, thinking it would just propel risk assets higher, bad economic news is now bad news […]
Read More
Date: August 5, 2024
Bulls Wounded – New Lows Coming Soon
I am sure I am wrong, but I don’t recall two such opposite days like Wednesday and Thursday since 2020 and 2008 before that. Wednesday was insanely strong from a price perspective, especially in the beaten down tech area. Thursday was super weak across the board for the most part. In hindsight I think the bulls used cover from earnings to window dress portfolios for month-end and that’s it. The NASDAQ 100 is below. In real time, Wednesday looked like […]
Read More
Date: August 2, 2024
***SPECIAL Fed Day Update – High Probability Opportunity***
Wednesday concludes the FOMC’s meeting with the Fed standing pat but likely offering dovish language in preparation of a September interest rate cut. The stock market model for the day is plus or minus 0.50% and then a rally post 2pm. Given the recent pullback as well as Tuesday’s action, the odds of a Fed day rally have greatly increased to 90% which means going long or adding to positions at Tuesday’s close. The challenge is that there are a […]
Read More
Date: July 31, 2024
The Down & Outs Are Up & In – Huge Week Ahead
Friday saw the bulls come back to work after the pullback had reached deep enough for them to see value. I am not sure it has run its course, but I always try to be nimble enough to take action and not get stuck in a mindset. Since March I have written about a number of big picture portfolio moves as we have reduced exposure where it had been over 100% as well as reduced or sold off AI and […]
Read More
Date: July 29, 2024
Lots Going On Beneath The Surface Of The Pullback
Happy Friday. Let’s talk pullback and what to glean from it. So far here is what has occurred. Dow Industrials -3% S&P 500 -4% S&P 400 -4% Russell 2000 -3.5% NASDAQ 100 -9% On the surface you may conclude that the pullback is basically even except for the NASDAQ 100. But you would be wrong. There is something important beneath the surface that the raw numbers do not show. First, all indices did not peak on the same day. The […]
Read More
Date: July 26, 2024
Not Ready To Upgrade 1-3 Month View Just Yet
Two weeks ago I downgraded my 1-3 month view of the stock market as you know, looking for a 4-7% pullback. However, we also saw an epic surge in participation which was one of the concerns I had. I wasn’t sure how that would all play out. I shared that for the first time since 2018 I think, we had sold out of all of our sector semiconductor position. We also reduced position sizes in Nvidia and Tesla. Yesterday, we […]
Read More
Date: July 24, 2024
Biden Out, Harris In – Does It Matter For The Markets?
Two weekends ago we had an assassination attempt on a former president. This past weekend the current president walks away from his incumbent race. And the U.S. is supposed to be the standard bearer for the world. Yeesh! I did learn something new about politics this weekend. All those who were reporting that President Biden would step down on Sunday afternoon actually knew what they were talking about and those folks have credibility. All those folks who vehemently and defiantly […]
Read More
Date: July 22, 2024
