Volatility Drops as Short-Term Sentiment Remains Frothy
The stock market has been relatively quiet the past few days. Don’t complain. While it’s a welcomed change, it’s also very normal and healthy to wring more volatility out of the market. Friday is one of the big quarterly expirations of options and futures so we can expect enormous volume right away. Depending on which source you believe, there is supposedly between $50 and $80 billion dollars of equities that needs to be sold. Looking at the non-NASDAQ major stock […]
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Date: June 18, 2020
It Didn’t Feel Like a Correction
From high to low on a closing basis the major stock market indices pulled back 7-12% over a three-day period ending last Thursday. On an intra-day basis, those figures are another percent or so more. It sure didn’t feel like a correction. It happened so quickly. But remember how compressed the stock market has become. Looking at the chart below of the Dow Industrials, we can see that the bout of weakness had the index decline to that horizontal, blue […]
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Date: June 17, 2020
2009 Still Giving Us Clues as Pullback Continues
After last Thursday’s drubbing, the bull did what they have done every time they have been threatened since the new bull market began in March. They rallied the stock market. On Friday, we saw a huge up opening that could not hold. Bears came in and sold the market into negative territory, only to see the bulls rally it back after lunch. This is classic sign of volatility and that there is a fierce fight going on. There are […]
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Date: June 15, 2020
Heritage Capital Launches New Website
Heritage Capital is pleased to announce the launch of our new and improved website! The new site went live on June 10. The fresh look and feel make it easier to find information, read about timely and important topics and contact us when you have a question. If you haven’t had a chance to check it out yet, please do. The easy-to-access navigation gives a clearer message of who we are, what it’s like to work with us and how […]
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Date: June 15, 2020
Market Got Its Excuse to Sell Off
Sorry for the delayed post and missing yesterday. We are migrating to a new host and new website and I got a little sidetracked. I am excited for our new website, www.investfortomorrow.com as well as a much better host. Truth is, if the new company, Digital Ocean, can even fog a mirror, they will be better than where we were for the past decade plus. I can’t even count how many times my email would go down or they would […]
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Date: June 11, 2020
Comparing This Bull Market Launch to 2009
Another new week begins, another pre-market rally in the stock market. I have to continue to say that the strength of the move is beyond unbelievable. I thought it was “unprecedented” until I looked deeper. When the trading range broke last month and I was expecting a possible fakeout, even if I was wrong, I didn’t think stocks would power ahead unabated like this. While people talk about this being “unprecedented”, that’s simply not true. When new bull markets launch, […]
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Date: June 8, 2020
WOW!
That was not supposed to be the headline for this morning. After yesterday I figured the employment numbers would be grim, but stocks would rally again because let’s face it; stocks have rallied on all bad news and pretty much all news. When the May employment report was released at 8:30am this morning, I thought it was a typo. I am sitting there watching it with an incredulous look on my face saying that it had to be wrong. How […]
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Date: June 5, 2020
Trading Range Ends But Bears Fail to Seize Control
Last week I updated my multi-month thesis that the stock market was in a trading range and to be on the lookout for a fake move whichever end was broken first. You can see that depicted in the chart below as stocks broke above the horizontal, blue line. So many times in history, the more obvious a pattern is in the markets and the more widely followed, the more likely the market is to confound the majority. It happens often, but for […]
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Date: June 3, 2020
Sentiment Percolating
Starting in the middle of November 2019, stock market sentiment went from bullish to giddy and then greedy before all was said and done. It had done that before in early 2017, 2018, mid-2011 and clearly during the Dotcom Bubble in 1999 and 2000. Sentiment alone is not a reason for markets to turn although we usually see that ingredient at extremes. Sentiment is also not a perfect timing tool. Remember the old adage that markets can stay irrational longer […]
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Date: June 1, 2020
Initial Jobless Claims – A Look Since March
Thursday is upon us and weekly jobless claims will be reported at 8:30am. The stock market has met every horrific report with intense buying. Many forget that the single worst week has been right around the market bottom on March 23. Since then, weekly new claims have plummeted, but I guess that between PPP and businesses staying open, there are only so many people who could additionally file. The real number is continuing claims which looks like it’s plateauing because […]
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Date: May 28, 2020
More Good News as the Trading Range Breaks Higher
As I mentioned in Friday’ post, not much happened last week after Monday’s sharply higher open. Stocks essentially treaded water and bullishly digested the gains. You could also say that has been the case since mid-April in the major indices with the exception of the NASDAQ 100 which is in a world of its own. Below is the Dow Industrials and you can see the trading range I have been discussing bound by the two horizontal blue lines. A few comments […]
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Date: May 26, 2020
Trading Range Continues. Bonds Thumped. Bulls to Win Today.
As I have been writing about, until proven otherwise which would mean I am wrong, the major stock indices with the exception of the NASDAQ 100 hit a ceiling last week and appear to be in a trading range bound by Dow 25,000 and roughly 22,000. On the S&P 500 that amounts to 2930 and 2630. The NASDAQ 100 is trading like it’s 1999 and all is very well in the world. The longer the range continues, the more significant […]
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Date: May 7, 2020
Warren Buffet Hangover as Bulls Prepare
The bears had a nice close to last week and to begin the new month. I posted a number of studies regarding May and the next 6 months on Friday. The overall theme is that the longer we look out into the future, the more positive the studies. The shorter we look, at least as of last week, the less positive they get. However, in the really short-term, if today is down, which would be the third straight down day, […]
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Date: May 4, 2020
May Begins With a Number of Studies as the Bulls Get Knocked a Bit
On Friday, the stock market technically begins the sometimes “dreaded” sell in May and go away period which last until October 31. This seasonal trend has a questionable track record the more recent you look. However, in years where January through April has been down already, its record has merit. I will touch more on this in the upcoming issue of Street$marts due out shortly. The first trading day of May has an enviably bullish track record, not so much […]
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Date: May 1, 2020
Bulls Seizing the Moment – Junk Bonds Not
On Monday I wrote about the Lines in the Sand that were drawn for both bull and bear. On Tuesday we saw the bulls celebrate with a breach to the upside that could not hold until the close. Today, the bulls are testing the upward bounds again, likely with very different results by the time the day ends. What’s been eating at me lately is high yield bonds as you can see below. They were behaving “fine” until the Fed […]
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Date: April 29, 2020
Bulls & Bears Draw Lines in the Sand
Stocks ended last week with a three day rally that looks to be built upon this morning. The major indices continue to trade in the range I outlined several weeks ago as the likely first bounce. What I did not envision was stocks getting into that range and then essentially going sideways. Historically, that has bullish implications. The first chart below is the S&P 500 on a daily basis so you can see the first bounce range of between 1/2 […]
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Date: April 27, 2020
Airlines Stocks Look Awful While Stock Market Risk Clearly Defined
Yesterday, I wrote about my anger and disgust regarding the airline bailout. That won’t change anytime soon. Today, I want to look at the group and how they have been trading. Below you can see a chart of the airlines as represented by the JETS ETF. Besides declining 65% from high to low since the market’s peak, notice how little green is on the chart. Green days mean the closing price is that much higher than the opening price. Red […]
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Date: April 24, 2020
Angry & Disgusted
Last week, the government announced a deal with the 10 major airlines in the U.S. for outright grants as well as low interest, long-term loans. The government gets very little in return. As you know, I have been imploring the government to do the unfathomable, the unthinkable since early March. Whatever number they had in mind for workers and small business, it wasn’t enough. I also had the utmost confidence that Treasury Secretary, Steve Mnuchin, and Fed Chair, Jay Powell, […]
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Date: April 23, 2020
Oil Trades Below – Dow 40,000???
The oil market has made headlines this year and especially this week with crude oil trading negatively for the first time in history. Yes; you read that correctly. May crude oil closed at -$37 on Monday. However, before you start running out to get paid to own oil, I put together this video to explain what is going on and if the retail investor can take advantage of the crash. If you would rather read a short blog post about […]
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Date: April 22, 2020
RMDs Waived But Mortgage Rates Not Following Bond Market
Recently, I wrote about the April 15 tax filing date being extended to July 15 and the presumption that contributions earmarked for 2019 would also be extended. The IRS confirmed that this week. I also wrote about converting your Traditional IRA to a ROTH IRA, something everyone should consider. Additionally, the recently passed $2 trillion CARES Act did something that I do not believe has ever been done before. It waived the need for people over the age of 70 […]
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Date: April 21, 2020
