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 After the recent bearish divergence resolved to the downside, the stock market rebounded sharply. Volatility was over-extended and my favorite breadth indicator plunged at an extreme rate. In that context, the stock market’s subsequent bounce made sense as relief from extreme conditions. The sellers followed through on the resolution of bearish divergence … Read more
Stock Market Commentary The Presidential inauguration is a hallowed American tradition. The stock market celebrated the incoming Biden and Harris administration with new all-time highs on good trading volume. The start of a new American administration is as good a time as any to back down from my recent short-term bearish call. While this overbought … Read more
Stock Market Commentary One hundred and fifty minutes. The bearish signal that hit the stock market after the last overbought period ended essentially lasted just 150 minutes. Buyers stepped into the market on Monday after lunchtime on the East Coast and essentially barely took a pause until the last 2 hours of trading today (Wednesday, … Read more
Stock Market Commentary The weakening overbought conditions finally gave way to a full breakdown. The abrupt end of the overbought period ushers in the bear. Ironically, trading started well with the S&P 500 (SPY) gapping slightly higher at the open. The selling pressure started after the open and did not relent until lunchtime on the … Read more
Stock Market Commentary The extended overbought period still looks tenuous. For the second trading day in a row, AT40 (T2108), the percentage of stocks trading above their respective 40-day moving averages (DMAs), broke down below the overbought threshold of 70% before closing at 73.0%. The major indices do not reveal these weakening overbought conditions. The … Read more