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 The latest overbought period lasted two days, a typical duration. However, the start of the period was atypical given the fuel from historic heroics from small cap stocks. The end of the overbought period was remarkable by delivering some of the clearest topping signals of the year. Key indices that soared into … Read more
Stock Market Commentary The second quarter of the year ended with notable divergence. The third quarter picked up where the second quarter left off. Q3 took the Q2 baton of notable divergence, sending big cap stocks ever higher while leaving most of the market further behind. The jobs report seemed to be strong enough and … Read more
Stock Market Commentary The S&P 500 (SPY) is up 3.0% since summer trading began the day after the Memorial Day weekend. If not for the poor market breadth, the rally would look like a repeat of last year’s summer of loving stocks (sorry sell in May and go away folks). Semiconductor stocks, particularly NVIDIA Corporation … Read more
Stock Market Commentary The stock market’s bearish divergence is too strong to ignore. The S&P 500 and the NASDAQ achieved all-time highs while market breadth sunk again this week. Both short-term and long-term market breadth indicators are at key support levels. Even if market breadth somehow rebounds from current levels, I find myself getting yet … Read more
Stock Market Commentary A plunge in market breadth on Wednesday made me expect a more bearish take on the markets for my next blog post. A sharp rebound led by strong earnings from various retail companies, quickly changed the narrative from a continued NVDA hangover to a bullish divergence and then a bullish setup. Friday’s … Read more
Stock Market Commentary I looked to last week’s earnings from NVIDIA Corporation (NVDA) with great anticipation. The indices gathered momentum with all-time highs and seemed to point to a big moment for NVDA. NVDA did indeed have a big moment, but it helped precious few. In fact, NVDA’s gain looked like a net loss. Buyer’s … Read more
Stock Market Commentary Can a bullish divergence create a bottom for stocks? The stock market ended last week with an emphatic “YES!” A wild week got treacherous after Thursday’s META pricequake. Investors rushed for the exits after Meta Platforms (META) reported earnings. The sympathy selling went far and wide. Fortunately, earnings from Alphabet (GOOG) and … Read more
Stock Market Commentary Last week was an intense week of trading. The ever-escalating conflict in the Middle East disturbed markets. However, the initial negative reaction in futures market was mostly erased by the time of the market open on Thursday. The indices even managed to gain ground before getting faded. Thus, the market still fundamentally … Read more
Stock Market Commentary Last week was a week like few other for the volatility index, the VIX. In my last Market Breadth I made the case for the VIX mattering again. A VIX follow-through demonstrated even more strength and resilience. The resulting closing high for the year is a firmer bearish signal for the stock … Read more
Stock Market Commentary NVIDIA Corporation (NVDA) confirmed a double-top with today’s 3.4% loss. For only the sixth time this year, NVDA closed below its uptrending support at the 20-day moving average (DMA) (the dotted line below). Three of these closes have come in the last three days. The stock is now within “inches” of confirming … Read more