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 After the stock market rally suffered strike one and strike two, Wednesday’s sudden pullback had all the signatures of a third strike to start the end of the extended overbought rally. Sellers surged in the final 90 minutes of trading that day. However, they failed to sustain the stampede for the exits. … Read more
The bear market intrusion to the oversold period gave way to an explosion of bullish trading action this week. The maximum drawdown of October for the S&P 500 (SPY) was 4.0% well above the average for the month. This extreme move provided the perfect setup for the sharpness of the current oversold bounce. The rubber … Read more
Stock Market Commentary At the end of September, I asked skeptically whether an oversold bounce could prevent an October swoon. As I suspected at the time, the answer turned out to be no. The market-moving headlines for October have included weighty, tragic, and alarming news making for a demotivating trading environment. An oversold bounce earlier … Read more
Stock Market Commentary The sentiment shifts following the bounce from oversold conditions swung from bullish and encouraging to tantalizing and disappointing. The stock market has a precarious setup going into a likely October swoon. The prospects for the current oversold bounce to prevent the October swoon hinge on a swirl of technical signs and fundamental … Read more
Stock Market Commentary Jackson Hole did not provide the market moving spark that I expected. Instead, soft economic news delivered the decisive interpretation of future monetary policy required to provide a fresh catalyst for stocks. The bullish spark caught me flat-footed as I was leaning into imminent oversold trading conditions. Fortunately, the sentiment shift was … Read more