Can Flynn End the Bull Market?
One month to go in 2017. Lots and lots of underinvested people chasing returns now. What the heck do they do? Especially when pullbacks have been few and far between. We haven’t seen a 10% decline since February 2016. There have been no pullbacks of 5-10% at all since then. The biggest decline we have seen was in Q3/Q4 2016 and that was 4.63% in the S&P 500. Hardly what people have been waiting for to invest their cash and […]
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Date: December 1, 2017
Decisive Breakout in Stocks but Bitcoin…
First, it seems like all of the talk lately and this week is about Bitcoin and the crypto sector. Do you care? Regardless,, will you take 10 seconds to answer three short questions? TAKE SURVEY With post-Thanksgiving being slightly seasonally weak, Tuesday’s action was a pleasant surprise for the bulls. Yesterday, I mentioned that while there were a number of very short-term crosscurrents, the intermediate-term remained positive. Four of the five major indices saw decisive and significant breakouts to new […]
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Date: November 29, 2017
Bulls Remain In Charge
Stocks came back from the semi-holiday weekend in good spirits, at least for the morning. There was no follow through though as a post-Thanksgiving hangover is usually the theme for the first day or two of the new week. We still have a variety of crosscurrents over the very, very short-term, but looking out one to three months, the picture is positive. As you know, it’s very difficult to see an end of year decline, especially when the year has […]
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Date: November 28, 2017
Another Seasonally Strong Day but Europe Should Not be Ignored
I hope everyone had a great Thanksgiving with lots of good food, family and friends. As I wore the hypocrite hat this year, we celebrated ours on Wednesday night so my daughter and I could fly to Oregon on Thursday to watch the UCONN men and women play in the PK80 basketball tournament in honor of Phil Knight’s (Nike founder) 80th birthday. The men played such a great game to beat Oregon last night, something I definitely did not expect. […]
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Date: November 24, 2017
Long & Strong for the Bulls. Happy Thanksgiving!
The bulls were long and strong on Tuesday with all five major stock market indices hitting all-time highs. You just cannot argue with price momentum. Semis, discretionary and banks were strong while the banks were just okay. We saw very good participation when looking at the NYSE A/D Line. High yield bonds were up but they could not add to their first half hour gains. Commodities, led by oil, just finished a little pullback and seem poised for a run […]
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Date: November 22, 2017
Bulls Stampede Ahead. The Hatred and Disavowing Continues
It looks like the bulls are getting a jump on the very strong seasonal tailwind that exists the day before Thanksgiving. All of the major indices look to open strongly to the upside with all-time highs across the board possible by the time we dig into the turkey. On the sector side, semis continue their relentless rally with consumer discretionary really kicking it into high gear. Banks are climbing nicely and transports look poised for perhaps the most upside in […]
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Date: November 21, 2017
The Disaster That is GE with 3 Alternatives
Last week, I had the pleasure of joining the Nightly Business Report hosted by two CNBC veterans, Sue Herera and Tyler Mathisen. You can find the segment at the 22 minute mark HERE. This is one show I always enjoy as I am the only guest in the segment and they let me articulate my point. On this particular evening, GE’s dividend cut was the big story of the day and that spilled over into dividend paying stocks in general. […]
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Date: November 20, 2017
Bulls Plow Ahead Despite Major Issues in Washington
Stocks opened strong and surged all the way to 2pm on Thursday, as the bulls sprung back to life. Small caps led in a big way and the NASDAQ 100 scored an all-time high. Perhaps most importantly, junk bonds saw a huge day and began to repair the damage inflicted over the past month. On the sector front, semis are back to within one good day from new highs. Consumer discretionary which I left for neutral last month is also […]
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Date: November 17, 2017
Bounce on the Way. Will It Stick?
After nothing more than one really bad day in most of the major indices, stocks look like they want to bounce, at least a little. The key index to watch will be the Russell 2000 which peaked in September and has seen an orderly 3% pullback ever since. For the past week, the small cap index has been trying to put in a low. Additionally, although early, this index will also have a seasonal tailwind next month and into January. […]
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Date: November 16, 2017
Strong Case for Bears But Bulls Could Be Ready Again
And the pullback continues. Everything I have mentioned lately is still in place and uncorrected. We have sentiment that’s a little too bullish. High yield bonds under pressure. Sector leadership weakening. And a very split market with the same percentage of stocks doing well as poorly. Except for price momentum and the positive time of year, the stock market does not look good. Yet with all that, the Dow is less than 1% from all-time highs. Bulls have something to […]
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Date: November 14, 2017
Lots of Concerns Abound
For the past 5 weeks I have often written about the elusive stock market pullback and the reasons why we shouldn’t be surprised to see it occur. We had seasonal headwinds post-September. We had strength into earnings season. We had overly bullish sentiment. Nothing really mattered for more than a day. And just because stocks are seeing some weakness here, I am not beating my chest with “I told ya so”. Being early still equals being wrong. Over the past […]
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Date: November 10, 2017
New Highs Abound But a Few Cracks Developing
Suffice to say that the bulls have basically stampeded any and all attempts to take stocks lower since mid-August. However, for most of that period, the market’s foundation was rock solid and bears were just fighting against strong momentum. Recently, that has changed. Because I have been traveling since late last week and a bit on the sick side, I haven’t spent the time to create the charts to support my point. The Dow, S&P 500, S&P 400 and NASDAQ […]
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Date: November 6, 2017
The Next Fed Chairman & Post Fed Market Decline
Trump to Announce Fed Choice This Afternoon Love him or hate him, Donald Trump certainly is not behaving like his predecessors when it comes to most things, but definitely not the selection of the most powerful banker on earth. During the campaign, Trump harshly and unfairly criticized Janet Yellen for keeping interest rates too low and creating a “fake stock market”. That was until he became president and miraculously embraced low rates and the surging stock market as a referendum […]
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Date: November 2, 2017
***Special Fed Day Alert. No Rate Hike. No Surprises***
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. Eight meetings ago was one of the rare times where the models strongly called for a rally on statement day which was correct as well as a decline a few days later which was also correct. Today, as with most statement […]
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Date: November 1, 2017
Q3 GDP Sees Another Resurgence & Energy Looking Sweet Again
On Friday, the government released a first look at Q3 GDP which I had been looking in the 3% range before the hurricanes hit. It wouldn’t have surprised me if that number was a quarter to half point lower. However, even with the hurricanes, the resilient U.S. economy still grew by 3%. All year, I have written about the economy accelerating to the upside in Q2 and Q3 with the election as the catalyst. Way too many people underestimated the […]
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Date: October 30, 2017
Pullback in Motion. Dow by Itself.
The Dow has now seen three straight days of negative behavior but the index remains a whisker from new highs. The big picture reveals some almost precedent setting behavior in the Dow as more stocks are closing lower than higher as the Dow was hitting all-time highs. That’s not your typical sign of strength. The S&P 500 and S&P 400 are a little weaker with the Russell 2000 and NASDAQ 100 a little more so. The pullback I have been […]
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Date: October 26, 2017
Stocks Continue to Creep But Best Opp for Pullback is Now
It’s really the same old story as we begin the new week and the final full week of October. The intermediate and long-term continue to look strong as they have for days, weeks, months and quarters. Nothing has changed. The short-term is the time frame where it’s neutral at best. I have said all month that the bulls need a little rest, but they haven’t seemed to care. Today, as I look at the five major stock market indices, the […]
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Date: October 23, 2017
Bulls Running Like Pamplona
This is looking more and more the running of the bulls in Pamplona. They just stampede anyone and everyone in their way. After the two strongly positive seasonal trends ended after the first week of October, there was sufficient evidence that stocks were due for a pause to refresh or modest, single digit pullback. That’s what I was looking for. Nothing big. Nothing significant. Nothing really actionable. Just your garden variety reset. Stocks came out of the gate to the […]
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Date: October 20, 2017
Anatomy of The Stock Market Crashes of 1929 & 1987. Can It Happen Today?
Today is the 30th anniversary of the stock crash of 1987. All week long there has been a stream of recountings, anecdotes and comparisons to today’s market. While I love nostalgia as much as anyone, there are almost no valid comparisons to 1987 and it’s pretty much a waste of time to take that argument. Writers, analysts and investors who insist that stocks are about to crash like 1987 are either perma-bears who have been wrong for the past 8 […]
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Date: October 19, 2017
Banks & Transports Still Tired. Modest Pullback Here.
Last Friday, I discussed what appeared to be tired behavior in the banks as they were selling off on good earnings news after rallying sharply into earnings season. Citigroup and JP Morgan were the examples. This morning, Goldman Sachs and Morgan Stanley beat earnings expectations, yet reaction has been muted with the former opening sharply higher and then selling off while the latter is hanging tight. I would not be surprised to see Morgan Stanley buck the trend in the […]
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Date: October 17, 2017
