Junk Bonds & the A/D Line Say All is Okay
From open to close, stocks have traded in a narrow range most of this week and around the same level each day except for Tuesday. As the old highs in the Dow Industrials, S&P 500 and NASDAQ 100 have come into reach, investors are pausing as they usually do to assess risk and reward. While I do not think it’s a layup for a breakout right here, I feel very confident that Dow 28,000 will be kissed this quarter with […]
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Date: October 18, 2019
Deal? What Deal???
I am sure I am not the only one who is really skeptical about this “trade deal” with China being real. While I am sure the two parties agreed on some items, we are so far from a real deal, signed, sealed and delivered. This doesn’t even sound like an agreement in principle since the Chinese have a different recollection and their state run news service tells their own story. This saga is far from over. The stock market was […]
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Date: October 14, 2019
Bears Wrong, Again?
On Monday, I wrote about the bulls thwarting the bears with another low forming in the stock market. I also showed some of the fuel that was building up for higher prices in the form of very negative options traders who are usually wrong. Couple that with my Twitter feed turning negative and the bears ostracizing my bullish view, I felt pretty good that stocks would rally. And rally they have in short order, catching the masses off guard. I […]
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Date: October 11, 2019
Bulls Thwart Bears With Another Low
Last Wednesday as stocks had pulled back to the lower end of the recent trading range, I thought we were about to see a showdown between the bulls and the bears. That battle was fought one day later as an early morning mini-collapse triggered by a poor manufacturing number flushed out the sellers and allowed the bulls to come roaring back the rest of the day with a beautiful intra-day reversal. On Friday, the bulls added to those gains and […]
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Date: October 7, 2019
The Truth About October
With Rosh Hashanah taking me out of the office for two days, I forgot to offer some stats as the sometimes nasty month of October begins. I cannot recall who first alerted me to the breakdown I am about to show so I will just say thanks to my usual cadre of characters whose work I value and respect. Rob Hanna, Ari Wald, Jason Goepfert and Tom McClellan. Overall, October has been better known for stock market bottoms than any […]
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Date: October 3, 2019
Lower End of Range Hit – Can Bulls Make a Stand?
Last week was the single worst week of the year based on seasonal patterns and it certainly lived up to the billing I gave it several times here. Weak seasonality didn’t end last Friday. It extends to the first part of October. For the past few weeks I have been in the trading range / mild pullback camp with an eye on the upper and lower ends of recent range. After stocks failed to exceed the top of the range […]
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Date: October 2, 2019
Stock Market Reaction to Impeachment
Here we go. I remember writing about impeachment in 1998 and hoped and prayed the country wouldn’t have to experience this kind of political circus again. It took 21 years, but the circus is back in D.C. Thankfully, since we only have two prior, modern day instances of impeachment, stock market results are certainly not statistically significant. Given that, however, let’s take a look at the environments surrounding each of the prior two along with where we are today. First, […]
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Date: September 27, 2019
Void of Relevant Data Makes Market Vulnerable to Headlines
With the Fed meeting behind us and earning season still a few weeks away, the markets are now acutely focused on geopolitical news. In other words, the markets are very susceptible to the latest headline or tweet. From my seat, stocks remain in a little range which I mentioned on Monday and you can see below on the right side of the chart bound by the purple line and blue line. While stocks could pop a little in very short-term, […]
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Date: September 25, 2019
Weak Week Clouds Short-Term Picture
Welcome to the single weakest week of the year, at least that’s what history suggests over the past 30 years or so. The five days after September options expiration have not been kind to the stock market overall. I should have done a little more digging to see how stocks behaved when they were already in uptrends heading into this week. Usually, September is much weaker when it begins with weakness, as I wrote about in The Myth of September’s […]
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Date: September 23, 2019
THE Weakest Seasonality of the Year is Here
Stocks are looking a little tired. That’s my take today. The bulls have tried twice to score new highs, but the bears have put up a little resistance over the past two weeks. While I do not believe the market is on the verge of a bear market or even a 10% decline, risk/reward is no longer tilted strongly towards the bulls. And that’s okay. FYI, next week is the weakest week of the year on an historical basis for […]
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Date: September 20, 2019
