ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
My wait for an entry point to buy Lennar (LEN) continues. On a day with multiple warning signs about the U.S. economy from companies like Csx Corp (CSX), the Census Bureau piled on with lukewarm data on housing starts. While single-family housing starts for June increased month-over-month by 3.5% to 847,000, housing starts decreased on … Read more
AT40 = 68.2% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 54.9% of stocks are trading above their respective 200DMAs (essentially matches the 2019 high and is a new 10-month high)VIX = 12.4Short-term Trading Call: neutral (caveats below) Stock Market Commentary After the report on June jobs, financial markets got … Read more
The breakout for home builders started with M.D.C. Holdings (MDC). MDC raised guidance and put strong emphasis on the positive expectations for its next earnings report. With analysts overwhelmingly bearish on the stock, the stock had plenty of upside surprise potential. The pent-up demand created a tremendous upward surge. Additional home builders are joining what … Read more
I have written plenty this year about the seasonal top in home builders. I even drew up a game plan to trade this pattern in a way to pay for the bullish trade that opens up during the period of seasonal strength. That seasonal top took its first good hit with a positive pre-earnings announcement … Read more
The Good When Lennar (LEN) reported earnings on June 25th, the stock market responded with the kind of hesitation and whiplash symbolic of the seasonal topping pattern in place for home builders. The first reaction was celebratory as LEN gapped upward and rallied as high 3.6%. The initial reporting on LEN earnings focused on all … Read more
AT40 = 68.0% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 55.1% of stocks are trading above their respective 200DMAs (essentially matches the 2019 high and is a new 10-month high)VIX = 13.3Short-term Trading Call: neutral (caveats below) Stock Market Commentary Good news is bad news….oops, nevermind The search for … Read more
Housing Market Intro/Summary After writing the last Housing Market Review, I was convinced a triple top had appeared in the iShares US Home Construction ETF (ITB). The May sell-off in the stock market pushed ITB into a breakdown below its 50-day moving average (DMA). Immediately after that post, ITB rebounded right through its 50DMA and … Read more
AT40 = 60.0% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 52.4% of stocks are trading above their respective 200DMAsVIX = 15.1Short-term Trading Call: neutral Stock Market Commentary Trade War The search for news bad enough to convince the Federal Reserve to cut rates continues. The weekend began with news … Read more
AT40 = 53.7% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 50.3% of stocks are trading above their respective 200DMAsVIX = 15.4Short-term Trading Call: neutral Stock Market Commentary The stock market is officially in bizarro world. The stock market is breathlessly rallying in anticipation of rate cuts that will come … Read more
AT40 = 42.2% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 46.0% of stocks are trading above their respective 200DMAsVIX = 15.3Short-term Trading Call: neutral Stock Market Commentary After two bearish fades to start the week, the stock market dribbled along. Now the market waits for word on news bad … Read more