ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
Stock Market Commentary I earlier wrote about a promising divergence between anxiety and breadth in the stock market. However, I cannot help rubbernecking the market’s crashes and accidents. They tell dramatic stories about the folly in price action that can come with easy monetary policy and free money. The market goes through cycles of excitement … Read more
Stock Market Commentary: The market feels heavy and bearish. Yet, the major indices continue to bounce between the edges of their “churn zones.” Last week’s churn delivered a surprising ray of light tantalizing the dour sentiment. While the S&P 500 and the NASDAQ closed with a second straight week of losses, the major breadth indicators … Read more
Stock Market Commentary A promising week of post-oversold trading ended in tensions over inflation, interest rates, and Ukraine. Overall, the stock market remains locked in churn. Yet, the view from individual stocks can provide cause for greater alarm. End of the week selling in big cap tech raised a red flag against my overall bullishness … Read more
Stock Market Commentary: At mid-week, the stock market looked poised to put on a defiant display of buying power. However, multiple negative headlines proved too much to bear. Hawkish Fed-speak greased the skids on Thursday. Another hot inflation report and escalating tensions at the Ukrainian border sealed the deal for angst to rule the day. … Read more
Back in October and November, Bitcoin (BTC/USD) created renewed excitement when the cryptocurrency challenged its all-time high and then set three new all-time highs. Unfortunately, the breakout turned into a fakeout. Bitcoin peaked with the NASDAQ (QQQ) in November as financial markets moved away from aggressively priced risk assets. However, a more sustainable bottom may … Read more
Stock Market Commentary Last week was full of dramatic price swings. Traders reacted in extreme ways to key earnings results. The wild behavior cascaded out to related stocks. Some of the collateral damage in the blast radius likely came from portfolio managers scrambling to rebalance holdings. I expect this kind of action to continue through … Read more
Housing Market Intro and Summary A hawkish Federal Reserve has changed the game for the housing market. At first, I thought the normalization in monetary policy would generate a “settling in” for the housing market. However with inventories tight, a scarcity in available labor, rising material costs, and a dysfunctional supply chain, higher rates may … Read more
Stock Market Commentary: The churn zones continued to hold sway over the market last week. Buyers effectively fought off a descent into a bear market by rallying the major indices up and out of the churn zone. Still, the narrative of churn stands thanks to a refresh of fear from Facebook’s post-earnings blow-up. Meta Platforms, … Read more
There was a hopeful narrative going into the last week’s Federal Reserve meeting that Fed Chair Jerome Powell and company would emerge more dovish. The stock market’s sell-off this year could frighten the Fed into standing down from its earlier insistence about tightening monetary policy. Not only did Powell stride into the press conference unbowed … Read more
Stock Market Commentary The stock market is scraping by just above oversold territory. The churn of last week has created a mosaic different trading conditions. The bears are salivating at the all-time lows. The hopefuls like me are finding slivers of opportunity in the breakouts. The stock charts in this review cover some of everything. … Read more