Pullback Remains in Place. Junk May Hold Key.
The short-term pullback I have seemingly written about for weeks and weeks remains in place although I am certainly not taking credit for calling it in a timely fashion. The Dow, S&P 500 and NASDAQ 100 have all pulled back constructively while the S&P 400 and Russell 2000 are uglier. The three stronger indices are just about to kiss their 21 day moving averages, while their weak cousins knifed right through the 21 as well as their 50 day moving […]
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Date: March 9, 2017
Third Avenue Travesty
After peaking way back in 2014 and declining ever since, the high yield (junk) bond market has finally made national news over the past week with the very high profile blow up of the Third Avenue Focused Credit Fund (TAFCF). This was not some fly by night little fund or fund family. It’s a small, mainstream mutual fund family and the fund itself had more than $3 billion in assets in 2014. Last week, after massive withdrawals, the fund announced […]
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Date: December 16, 2015
Spurt or Pullback???
Stocks continue to digest the gains made in early November without giving up against the negative news backdrop. That’s a well supported, resilient market. When the major indices close above their November highs, we should see a quick spurt to the upside. If they fail to do so this week, I would not be surprised at all to see a mild 1-3% pullback lasting a week or two to set up the Santa Claus rally into 2016. My theme remains […]
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Date: December 1, 2015
Bulls Come Back to Life
Stocks came into the week on their heels from the recent pullback and the horrific terrorist attacks in Paris. In my previous post, I offered that the odds favored some more weakness with a reversal this week. The market saw a quick bout of weakness to open the week, but quickly reversed into a very strong day for the bulls on Monday. While Tuesday saw some internal soft spots, the bears will have a tough time taking control unless stocks […]
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Date: November 18, 2015
Pullback Deeper Than Expected
Stocks continue under pressure as they pullback from the huge run last month. Last week, I offered that this week would be the buying opportunity, but the pullback has been deeper than I expected. “Relentless” would be an exaggeration, but there has certainly been some strong selling. While Friday’s action did show the major indices mostly down 1%+, the selling was less severe than Thursday. Going in to next week, volatility should continue to be on the high side and […]
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Date: November 13, 2015
Pullback Orderly and Constructive So Far
The pullback that began last Wednesday in the major stock market indices continues. It’s been orderly and constructive so far and if the super bullish case remains, it should wrap up sooner than later. The stock market is digesting the better than expected employment report and is coming to terms with a December rate hike by the Fed. The banks and discretionary continue to lead which is a positive sign over the intermediate-term. Transports are transitioning to leadership and that’s […]
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Date: November 10, 2015
Pullback to Buy
Stocks are finally seeing some pause in the relentless rally that began a little over a month ago. It should be mild, relatively painless and in the 1-3% range. As I continue to mention, any and all weakness is a buying opportunity until proven otherwise. And there’s a chance that the “proven otherwise” won’t be seen until well into 2016. Internally, the stock market has been and is on solid footing. As you can see from the chart below, the […]
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Date: November 5, 2015
Stepping on the Bears’ Throats
As bullish as I have been, and I don’t think many have been as positive as I have been, the stock market is now starting to surprise even me on the upside. Coming in to the week, stocks were looking a little tired and in need of some rest, either by going sideways for a few weeks or by seeing a mild pullback of 1-3%. Instead, stocks are continuing to move higher although the rate of acceleration has slowed. I […]
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Date: November 3, 2015
Catching Their Breath
After a huge win for the bulls last week, stocks have become very short-term overbought. I don’t think the rally is over nor do I think any meaningful weakness will unfold. Rather, I think the bulls need a pause to refresh which can be accomplished by going sideways for a period of time or seeing a quick pullback. Either way, new highs should be up next and buying any weakness is the strategy until proven otherwise. Am I certain that […]
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Date: October 26, 2015
Pain for the Bears
After two straight down days and four days of pause overall, the bulls roared back to life on Thursday as you would normally expect during a powerful move off a bottom. It’s that first mild pullback from a significant low where the bears get a little excited that it could be another leg down, but all of the Johnny Come Lately bulls realize it may be their last chance to get on board. More pain for the bears. Recent sentiment […]
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Date: October 16, 2015
