Enhancing Social Security With Active Management in Market Volatility
With inflation, healthcare costs, and rising home expenses, including high property taxes, Connecticut retirees struggle to cover their monthly needs with Social Security and pensions. Many are turning to their savings and investments to make ends meet. With so much economic uncertainty, geopolitical tensions, and concerns about Social Security’s future stability, how would a major stock market downturn affect your investments and retirement income? Many so-called financial gurus recommend a static, passive investment strategy that tracks a market index. But […]
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Date: August 30, 2024
No Stock Market Crash From Nvidia
The stock market keeps surviving each event the media makes into potential Armageddon. On Wednesday, I wrote about Nvidia and the likelihood for a move outside of $131 and $123. That came in the form of a less than perfectly stellar report and sharp move on heavy volume to the downside. Smart money knew the odds. For now, I think rallies above $121 are selling opportunities. Super Micro crashed even more. Almost 100% of the AI gains have been wiped […]
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Date: August 30, 2024
It’s All About Nvidia Today – BE CAREFUL
Nvidia reports reports earnings late this afternoon. I will be happy to get this done since all anyone is focused on is this report. I mean, it’s important, but it is certainly not the end all, be all. While we have plenty of positions in the NASDAQ 100, which will be directly impacted, we also own large cap value, small caps, financials, biotech, staples, REITs and plenty of other things that have absolutely no correlation to Nvidia or AI or […]
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Date: August 28, 2024
Powell Delivers – Indices Diverge – Mega Cap Tech Lagging
Fed Chair Powell did not disappoint. He was brief and clearly confirmed that rate cuts were coming without offering the cadence. I was a bit surprised that markets hadn’t already priced that in since 95% of participants expected it. With the 2-Year under 4% and short-term rates above 5% there is plenty of room into 2025 for the Fed to juice the economy. The billion dollar question will be if it’s too late or more ammunition for the soft landing. […]
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Date: August 26, 2024
Stressed by Election Jitters? Heritage Capital, Your Connecticut Financial Advisors, Can Help
With the upcoming election looming, are you feeling anxious about its impact on your hard-earned investments? This concern is understandable because election cycles have historically been linked to more market volatility. In this article by Heritage Capital, we’ll discuss the connection between elections and market fluctuations and how they can trigger emotional reactions in investors. We’ll explore the benefits of active management in a volatile market, especially during times of election-related anxieties. The Impact of Election Anxiety on Investors The […]
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Date: August 26, 2024
Powell On Tap With Dovish Songs
With the stock market’s winning streak ending a few days ago and Thursday being down moderately, will the media run crawls on screen today that stocks have been down two of the last three days? Will it be “BREAKING NEWS”? Today is Fed Chair Jay Powell’s annual speech from Jackson Hole, Wyoming. It has been on the calendar on all year. I expect it to be brief and dovish, but not offer cadence on how rate cuts will unfold. The […]
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Date: August 23, 2024
Finally A Down Day – Sentiment Back To Greedy
The stock market finally had a down day, albeit a small one where the damage was seen in the mid and small caps. The media can stop with the nonsense about how many up days in a row the S&P 500 has seen. The bottom line is that momentum has been strong and some thrusts off of the mini-crash low on August 5th have been triggered. While that’s relatively unimportant for the short-term, it does typically insulate the stock market […]
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Date: August 21, 2024
Earthquake Or Rogue Wave – A Look At 1997 & 1998 For Clues
Continuing on the theme I mentioned on Friday about an earthquake or rogue wave, I went back to the two international events that caused these in the 1990s. The first chart below is from 1997 when the Asian currency crisis hit in October. On that day in October the Dow Industrials saw their single largest point decline in history. Of course, on a percentage basis, it didn’t rank all that high. After an all-time high in early October and a […]
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Date: August 19, 2024
Early or Wrong?
The stock market has had a strong rally, at least price-wise since the earthquake 11 days ago. My thesis has been for several more aftershocks over the ensuing weeks and possibly longer. One thing I cannot argue with is the acceleration in what I have labeled as a bounce. I also have said that I would be surprised if the stock market went straight back to new highs. Aside from one aftershock last week, the bulls have powered ahead unabated. […]
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Date: August 16, 2024
Big Run Up – Sell a Higher Open
The rally off the earthquake low 9 days has been impressive price-wise, but anemic volume-wise. It looks like an absence of sellers versus an abundance of buyers. I have used the rally to reposition some portfolios and reduce exposure in others. I continue to believe there are more aftershocks coming later this month and in September. The securities that worry me the most are the ones that fell into last Monday’s mini-crash, but haven’t rallied with the market. We have […]
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Date: August 14, 2024
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% […]
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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 […]
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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 […]
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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 […]
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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 […]
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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 […]
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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 […]
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Date: July 29, 2024
Enhancing Social Security With Active Management in Market Volatility
With inflation, healthcare costs, and rising home expenses, including high property taxes, Connecticut retirees struggle to cover their monthly needs with Social Security and pensions. Many are turning to their savings and investments to make ends meet. With so much economic uncertainty, geopolitical tensions, and concerns about Social Security’s future stability, how would a major stock market downturn affect your investments and retirement income? Many so-called financial gurus recommend a static, passive investment strategy that tracks a market index. But […]
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 […]
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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 […]
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Date: July 24, 2024
