ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
AT40 = 54.0% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 46.0% of stocks are trading above their respective 200DMAs VIX = 15.4 Short-term Trading Call: cautiously bearish Commentary Source: My Daughter A week ago, I finally changed my short-term trading call: I went from neutral to cautiously bearish. When … Read more
AT40 = 55.2% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 46.4% of stocks are trading above their respective 200DMAs VIX = 16.9 Short-term Trading Call: cautiously bearish Commentary The stock market faded from bullish undertones and back into the resting position. Now we can just look back at what … Read more
AT40 = 45.9% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 44.0% of stocks are trading above their respective 200DMAs VIX = 17.4 Short-term Trading Call: neutral Commentary The S&P 500 (SPY) gained 2.0% for the week. Yet the week felt like a loser given the way it ended. The … Read more
Two weeks ago I expressed concern about the poor performance of the materials sector. The sector was under-performing the general market which seemed particularly ominous given the generally strong outlook for the economy. At the time, I expressed my hope that another interview with Bill Sandbrook, CEO of U.S. Concrete (USCR), would clear the air … Read more
This picture is exactly what I do not want to see as the stock market struggles to hold critical technical supports: a major index of economically-sensitive stocks confirming a breakdown of support at its 200-day moving average (DMA). The Materials Select Sector SPDR ETF (XLB) lost 1.3% on a day when the S&P 500 (SPY) … Read more
At the beginning of the month I described what I called “maximum bearishness for silver.” For the first time in at least 10 years, speculators flipped net bearish on silver. At the same time, speculators remained quite bullish on gold. I decided to initiate a pairs trade going long iShares Silver Trust (SLV) calls and … Read more
At the beginning of February, I refreshed my idea to play a top in iron ore with a pairs trade going long Rio Tinto (RIO) and short BHP Billiton (BHP). The timing was fortuitous given it was right before a large sell-off in the stock market. I ended up profitably fading rallies in BHP two … Read more
For the first time since at least 2008, speculators flipped bearish on silver. Source: Oanda’s CFTC’s Commitments of Traders Speculative net contracts have trended downward for about a year and approached zero in December around the time the Federal Reserve last hiked rates. Yet, I did not think it was “possible” for positioning to go … Read more
AT40 = 32.8% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 49.5% of stocks are trading above their respective 200DMAs VIX = 19.5 Short-term Trading Call: cautiously bullish (downgrade from bullish – see below for more details) Commentary The trading contours in the aftermath of an oversold episode can move … Read more
AT40 = 27.5% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 48.3% of stocks are trading above their respective 200DMAs VIX = 19.3 (drop of 22.9%) Short-term Trading Call: bullish PROLOGUE Valentine’s Day, February 14th, was a great day in the stock market and a fantastic validation of my strategizing … Read more