Bulls Cede Control from Bears
Friday was a very good day for the bulls on the heels of a little reversal on Thursday that pierced the recent lows on the Dow, S&P 400 and Russell 2000. While I would have preferred the S&P 500 and NASDAQ 100 to have joined that party to run the weak money out of the market, it’s not the end of the world. You can see what I am talking about below in the lower right side of the chart […]
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Date: August 19, 2019
Bear Clowns Wrong, AGAIN – Dow 28,000 on the Way
The news backdrop certainly isn’t good. Trump adds tariffs. China threatens retaliation. Hong Kong protests. China readying to “invade”. Germany and Italy in recession. Yield curve inverts in U.S. Recession fears explode higher. All of this sounds so bad. Like there is no hope, just darkness. Yet stocks are merely 6.5% from an all-time high. 6.5%! I will go one step further. News like I mentioned more often occurs as the stock market gropes for a bottom than puts in […]
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Date: August 16, 2019
Nope. Not a Bear Market
As I continue to write about, while much or most of the price damage should be over, day to day volatility is not. Worries have shifted from tariffs and a trade war to civil unrest in Hong Kong which is also associated with China. Remember, regardless of the situation, there is always, always, always “major” news surrounding a market’s attempt to bottom. That’s just how it is. It seems like every single time stocks pullback at least 5%, I get […]
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Date: August 12, 2019
Stocks Thrashing Around for a Bottom But Other Markets Hold Clues
Volatility happens in both directions. That has been the theme all week. Anyone who has bought strength or sold weakness has been left holding the bag. And I don’t think volatility is over, but much or most of the price damage should be. Worst case, as I have written, Dow 25,000 or so could be seen. The reward is a move to 28,000. With stocks thrashing around trying to find a low, I often look at other markets for signs […]
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Date: August 9, 2019
Hold on to Your Hats
As you know, volatility rarely builds slowly. It typically happens all at once. I went to bed last night and saw overnight trading indicating a lower open by 100 Dow points. When I woke up, that had shifted to up 100 Dow points. I showered, got dressed and ate breakfast. The Dow was then indicated to open lower by 300 points as global bond yields collapsed. Why do we care about this? Lower bond yields are mostly indicative of weakness […]
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Date: August 7, 2019
Here We Go Again
It’s been a tough three days for the bulls that is about to get worse as China retaliated for Trump’s tariffs with a series of their own. Their currency, the yuan, also fell below what analysts have deemed “critical” levels. It has long been argued that by weakening their currency, China has been able to partially offset the impact of the tariffs. I won’t get into another diatribe about how I detest and hate using tariffs as part of economic […]
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Date: August 5, 2019
Economic Reports Overshadowed by Trump & Powell
It’s been quite a week! Lost in the Fed and tariffs headlines has been three important economic reports that lead to a conclusion as clear as mud. The Chicago Purchasing Managers Index cratered to under 45, signaling trouble in the manufacturing sector. However, this number does have the importance it once did as the economy is only about 12% manufacturing these days. We also saw Consumer Confidence soar in July to just shy of an all-time high. That’s a little […]
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Date: August 2, 2019
Big Week Ahead
Boy, it only took a single day of weakness, Thursday, for bulls to get right back to work. Friday made quick work of the bears and the bulls look like they are not quite done yet. Of course, the Fed will have a lot to say about that when they conclude their two day meeting on Wednesday with an almost certainty for fireworks. More on that in another update. The government released Q2 GDP and it can be interpreted two […]
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Date: July 28, 2019
Lots of Sideways Action – Could Lead to Another Leg Higher
With tech earnings season in peak mode, we are seeing huge moves in the prominent companies like Amazon, Google and Facebook, but overall, the indices have been relatively calm. The Dow and S&P 500 have been range bound and the longer this sideways action continues, the more likely the ultimate resolution will be to the upside. Bears have been pointing to the poor action in the S&P 400 and Russell 2000. The problem is that they have been behaving poorly […]
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Date: July 26, 2019
Lots of Ammo for the Bears
Lots of focus on technology this week as some of the behemoths report earnings. One thing is certain; there will be movement. All of the major stock market indices ended last week on the defensive as the bears put the plow down with a very heavy selling wave last Friday afternoon. That resulted in hundreds of stocks closing lower from all-time or recent highs which a yet another sign of a tired market. Coupled with overly confident options traders and […]
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Date: July 23, 2019
