ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
The U.S. dollar index (DXY) continues to pivot around its 200-day moving average (DMA). Last week, the U.S. dollar bounced before retesting the lows from March. The U.S. dollar now looks ready to challenge its 200DMA as resistance; it will likely complete another cycle by rallying at least to the previous highs above the 200DMA. … Read more
Stock Market Statistics AT40 = 82.6% of stocks are trading above their respective 40-day moving averages (DMAs) (first oversold day)AT200 = 17.7% of stocks are trading above their respective 200DMAsVIX = 31.2Short-term Trading Call: neutral Stock Market Commentary On Tuesday, AT40 (T2108), the percentage of stocks trading above their respective 40-day moving averages (DMAs), rallied … Read more
AT40 = 24.4% of stocks are trading above their respective 40-day moving averages (DMAs) (ended 31-day oversold period)AT200 = 10.9% of stocks are trading above their respective 200DMAsVIX = 41.7Short-term Trading Call: cautiously bullish Stock Market Commentary “The Federal Reserve on Thursday took additional actions to provide up to $2.3 trillion in loans to support … Read more
When the stock market sell-off began in earnest in late February, the U.S. dollar index (DXY) surprisingly plunged along with the major indices. I accepted the narrative explaining that the dollar’s decline came from the euro’s gain as “risk-off” traders rushed to close out euro shorts in carry trades. The swiftness of the risk-off move … Read more
AT40 = 3.8% of stocks are trading above their respective 40-day moving averages (DMAs) (23rd oversold day)AT200 = 5.0% of stocks are trading above their respective 200DMAs (new low for the oversold period)VIX = 65.5Short-term Trading Call: bullish Stock Market Commentary First a dose of hope: “Coronavirus treatment: Palo Alto woman recovers from coronavirus after … Read more
In an earlier post on Sunday, I provided reasons to believe that the market was finally drawing a line in the sand for a sustainable bottom. With anticipation, I pronounced I would go on a shopping spreed down to S&P 500 (SPY) 2600. At the time of writing, it looks like I may have to … Read more
AT40 = 1.7% of stocks are trading above their respective 40-day moving averages (DMAs) (12th oversold day)AT200 = 4.1% of stocks are trading above their respective 200DMAsVIX = 75.5 (just short of financial crisis all-time high of 90)Short-term Trading Call: bullish Stock Market Commentary When I said a persistently elevated volatility index (VIX) warned us … Read more
The race to zero interest rate policies (ZIRPs) is reaching a climax. Australia: Reserve Bank of Australia On March 3, 2020, The Reserve Bank of Australia dropped its key interest rate 25 basis points (bps) from 0.75% to 0.5%, an all-time low for Australia. In doing so the RBA proclaimed the following in its statement: … Read more
AT40 = 17.5% of stocks are trading above their respective 40-day moving averages (DMAs) (6th oversold day)AT200 = 32.9% of stocks are trading above their respective 200DMAsVIX = 32.0Short-term Trading Call: bullish Stock Market Commentary Was it a delayed response to the emergency rate cut from the Federal Reserve? Was it the big comeback by … Read more
Fed to the Rescue If you are sitting at home wringing your hands about catching a virus from the outside world, I am guessing you are not exactly relieved to hear that the U.S. Federal Reserve may try to come to your rescue with more rate cuts. Yet, easy money is what central banks know … Read more