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 bulls were right at the frontier of overbought trading. The threshold defining overbought market breadth held firm and punched sentiment out of bullish territory. While this development is typically bearish, the summer of loving stocks still has uptrends supporting the potential for buying dips at moving averages. This is a time … Read more
Stock Market Commentary: Flying on the wings of an AI (artificial intelligence) gold rush, the NASDAQ may have delivered the swan song for its bear market. The latest rush of buying, sent the NASDAQ above its bear market line for the first time since last August. The path to this breakthrough was fraught with yet … Read more
Stock Market Commentary: What was quiet in the prior week is now loud and clear. Led by the NASDAQ, the stock market is in breakout mode. While market breadth is not quite endorsing the move, key breakouts are showing up in the indices and individual stocks. The inability of sellers to take advantage of bad … Read more
Stock Market Commentary: The U.S.’s looming debt ceiling crisis is a manufactured emergency. The whole political wrangling could end in an instant with a very simple decision to keep budget negotiations in the budget process. Thus, the stock market’s relative calm about the political stalemate does not surprise me. Moreover, who are the motivated sellers … Read more
Stock Market Commentary: In the previous week, the stock market put on a display of strength ahead of the Federal Reserve’s May decision on monetary policy. That bravado was temporarily undermined by the final blow to First Republic Bank (FRC). After a one-day pause, presumably to contemplate the implications of the lack of a coherent … Read more
Stock Market Commentary: On a weekly basis, the stock market seems to flip its abiding theme. One week after I accused the stock market of sleepwalking, buyers roused the major indices out of their slumber with a new and sudden display of strength. A 13.9% post-earnings surge from Meta Platforms, Inc (META) seemed to set … Read more
“We are encouraged that inflation is declining, and we are seized with the importance of staying the course and restoring price stability for Canadians. Inflation is coming down quickly and is forecast to be around 3% this summer. The economy is expected to grow modestly even as inflation comes down. This is good news, but it is not job done.” “Monetary … Read more
ChatGPT Speaks I continue to find interesting and valuable ways to use ChatGPT. After listening to a segment on CNBC’s Fast Money that wrangled over the risks in commercial real estate, I decided to ask ChatGPT a topical question: “What publicly traded commercial real estate REITs struggled the most during the great financial crisis?” I … Read more
Stock Market Commentary: A sobering thought: American capitalism has yet to figure out how to sustain a stable banking system. The U.S. created the Federal Reserve system in 1914 as a response to the lessons from the banking Panic of 1907 and yet bank runs, bank panics, and bank failures continue to headline market dynamics … Read more
Stock Market Commentary: Unlike the prior week, last week was all about the fundamentals, and the fundamentals made a huge difference. After failing to break through picture-perfect resistance levels, especially the 20-day moving averages (DMAs) (the dotted lines in the charts below), the indices were left vulnerable to selling pressure. The pressure started with Federal … Read more