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 Fades were on display, especially on Thursday, as the stock market showed signs of exhaustion. Bad news in and for the semiconductor industry seemed to motivate sellers. For example, earnings for Microsoft (MSFT) and Meta Platforms (META) seemed to release some steam on hyped expectations for the AI chips both companies will … Read more
Stock Market Commentary Bearish engulfing patterns flag potential tops at the end of uptrends. They represent the potential exhaustion of buying power as price first opens above the previous day’s high and then closes below the previous day’s close. Thus, the latest round of bearish engulfing patterns in major indices and major stocks should be … Read more
Stock Market Commentary October is the third of the stock market’s three most dangerous months. October, 2024 started with a convergence of bad news tailor-made to fulfill October’s seasonal destiny: intensifying war and geo-political tensions, two intense hurricanes, the looming contentiousness of the U.S. presidential election, another failure from the overbought threshold (bearish according to … Read more
Stock Market Commentary The stock market poetically swung from the depths of despair with a seasonal September drawdown to a sharp rebound in giddy anticipation of rate cuts from the Federal Reserve on Wednesday. The highly anticipated meeting has the potential to set the market’s tone for the remainder of the year. If Chair Jerome … Read more
Stock Market Commentary The S&P 500 is down 4.1% month-to-date. This loss makes this month a below average September for a maximum drawdown and fulfills September’s reputation as one of the index’s three most dangerous months of the year. As I noted last week, August’s extreme drawdown significantly increased the risk of September being worse … Read more
Stock Market Commentary At the beginning of August, you might have looked uninformed predicting that the S&P 500 would end up printing its 4th straight monthly gain. At its lows, the index wiped out gains from the previous two months and almost reversed May as well. Now, the index hovers just below its all-time high … Read more
Stock Market Commentary The stock market’s V-shaped recovery finished reversing most of the losses from the August calamity. Small caps are once again the laggards. During this recovery the market swung from recessions fears to recession relief. The prospects for interest rate cuts no longer seemed to matter on either side of the V-shape. The … Read more
Stock Market Commentary Last week started with a calamity and ended with a restless calm. Critical trendlines held as support as buyers and bulls ground their way to a near full reversal of Monday’s loss. Ironically, the market even found relief in a “better than expected” weekly unemployment claims report. Claims fell 17,000 from the … Read more
Stock Market Commentary Welcome to the start of the stock market’s three most dangerous months of the year. A weak jobs report for July helped to send market sentiment into a sharp reversal. The bad economic news suddenly turned the prospect of rate cuts into something to fear. These rate cut fears spun the market … Read more
Stock Market Commentary Bears still look ready to bow out, but they still have their paws firmly planted on high-tech stocks, especially semiconductors. The market rotations out of tech are nudging enough stocks higher, especially small caps, to rechallenge the threshold defining overbought conditions for market breadth. The stark divergence in stocks greatly reduces the … Read more