Fed’s Arrogance Will Lead to Disaster for Economy
Stock Market Behavior Models for the Day As with every Federal Open Market Committee (FOMC) statement day, there is a model for the stock market to follow pre and post announcement. Certain environments have very strong tendencies while others do not. Over the past few meetings, many of the strongest trends immediately before and after were muted except for a modest post FOMC trend last meeting which called for mild weakness the very next day. The S&P 500 lost 10 […]
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Date: January 31, 2018
Stocks Can Go Down?!?!
On Monday we learned that stocks can actually decline in 2018. On Tuesday, we are about to find out that stocks can go down on back to back days and accelerate lower. People seem to have forgotten that! With a trading range/pullback setting in, I am looking at Dow 25,800 as a logical downside target, but of course, we could go a bit lower. Semis, banks and discretionary are acting well and transports aren’t horrendous. There is news just out […]
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Date: January 30, 2018
Don’t Confuse Brains with a Bull Market
On Wednesday at 9:20 am I will be with Laura Hutchinson on WTNH (ABC in CT) unveiling my top financial resolutions for 2018 with a special focus on those directly impacted by the tax reform bill passed last month. It has been one heck of a start to 2018 in the stock market with some of the strongest momentum in history. As I have mentioned a number of times, animal spirits were released into the economy and markets a year […]
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Date: January 23, 2018
Permanently Higher Stock Prices
Last week I offered the idea that stocks may be settling into a little trading range before resuming the rally. Well that lasted all of one day as the bulls continue to press higher to begin the new week. Time and time again this market has punished any and all who dare to hold cash or, heaven forbid, short the market or hedge. As continue writing my year-end report to clients and I review commentary, I realized that for 20 […]
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Date: January 23, 2018
Trading Range Quietly Sets In
Two days ago, I wrote about a vicious, nasty and wicked reversal across the stock market. While the pundits and naysayers concluded various bearish scenarios, history and facts didn’t back that up to any strong degree unless you wanted to cherry pick. More times than not, after a one day, ugly reversal, a short-term trading range sets in, which I see occurring right now. Interestingly, the biggest reversals this week were seen in the S&P 400 and Russell 2000 and […]
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Date: January 19, 2018
Nasty, Wicked, Ugly Reversal
No sooner did the ink dry on yesterday’s blog than the markets saw a very ugly and wicked reversal which saw the Dow give up almost 400 points from high to low. The “feel” I wrote about turned out to be prescient pretty quickly as volatility spiked in a huge way on a relative basis. Check out the chart of the VIX below over the last two days. When you look at any of the major indices, sector or stocks, […]
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Date: January 17, 2018
Volatility Index Acting Weird as Stocks Just Continue Higher
A new week begins and to no one’s surprise, stocks are set to open sharply higher. Even during the Dotcom bubble, stocks took a breather every now and then. In fact, they became very volatile during their melt up phase. That’s an element that has been lacking during this leg of the bull market.It’s not a great chart, but take a look at the volatility index below, also known as the VIX. Essentially, since the year began, this index has […]
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Date: January 16, 2018
Small Caps Breaking Out. Certain Sectors like Dotcom/Bitcoin
After finally seeing a down day, the bulls came right back to work on Thursday with a blistering effort and very strong internals. That trend looks likely to continue into the holiday weekend. The real star of the day was the Russell 2000 index of small cap companies which had generally been consolidating nicely before bursting higher. You can see the blue line below which shows a ceiling where price has stopped three times before, also known as a flat […]
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Date: January 12, 2018
One Down Day. New Bear Market?
In what continues to be an epic start to the New Year, the stock market finally did see a down day, albeit very small. The major indices closed fractionally lower without any damage being done. Yes, some have mentioned that the rally is “narrowing”, meaning less participation, however the NYSE A/D Line just hit an all-time this week. That’s a hard case to make that trouble is looming. Other have noticed that some of the weekly employment data is just […]
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Date: January 11, 2018
Melt Up Continues as Goldilocks Rules the Employment Report
Four days in the New Year, four straight for the bulls. All major stock market indices remain at all-time highs. Nothing has been able to stop the stock market from surging higher. In fact, the move has been so powerful and widespread that after almost 9 years and 19,000 Dow points, the masses are FINALLY embracing the bull market. This can be seen in AAII sentiment figures, consumer confidence, Bitcoin and general public banter about how stocks have only one […]
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Date: January 7, 2018
