Australian Dollar: A Fading Pandemic Supports A V-Shaped Recovery

“Other scenarios for the recovery phase can readily be envisaged. Given the relatively rapid decline in the number of new COVID-19 cases in Australia, it is possible to contemplate an upside scenario where most domestic restrictions on activity are relaxed a little sooner and the economy recovers somewhat faster than in the baseline scenario. The greater … Read more

Overbought Holding Pattern for the Stock Market – Above the 40 (May 22, 2020)

Stock Market Statistics AT40 = 73.1% of stocks are trading above their respective 40-day moving averages (DMAs) (overbought 4 of last 5 trading days)AT200 = 20.0% of stocks are trading above their respective 200DMAsVIX = 28.2Short-term Trading Call: neutral Stock Market Commentary The stock market had a promising start with a large gap up to … Read more

How to Protect Gains After Surviving A Stock Market Sell-Off

The stock market crash in March was stomach-churning and generated a lot of panic. At its lowest point, the S&P 500 (SPY) was down 33.9% from its all-time high set just the previous month. The rebound from that stock market sell-off has been heroic with a 32.1% gain taking the index within another 14.6% rally … Read more

Stock Market Breaks Out to Overbought Territory Yet Again – Above the 40 (May 18, 2020)

Stock Market Statistics AT40 = 75.0% of stocks are trading above their respective 40-day moving averages (DMAs) (first oversold day)AT200 = 18.4% of stocks are trading above their respective 200DMAsVIX = 29.3Short-term Trading Call: neutral Stock Market Commentary Buyers followed through on the building momentum from the previous two trading days which drew a line … Read more

Stock Market Buyers Counter Sellers With Their Own Line in the Sand – Above the 40 (May 15, 2020)

Stock Market Statistics AT40 = 56.6% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 14.5% of stocks are trading above their respective 200DMAsVIX = 31.9Short-term Trading Call: neutral Stock Market Commentary The week began with sellers finally drawing a line in the sand. The week ended with a counter from … Read more

Housing Downturn: Optimism Races Ahead of the Data – Housing Market Review (April, 2020)

The iShares Dow Jones US Home Construction Index (ITB) gained 4.2% and closed at a 2-month high.

Housing Market Intro and Summary Something surprising is happening in the middle of the current downturn in the housing market: buyers keep coming and home builders are staying resilient and resolute. A series of earnings reports from publicly traded home builders do not reflect the historic plunge in builder sentiment from April (see below). The … Read more

Stock Market Rebounds Deeply Into Overbought Trading Conditions – Above the 40 (May 8, 2020)

Stock Market Statistics AT40 = 82.3% of stocks are trading above their respective 40-day moving averages (DMAs) (overbought day #2)AT200 = 16.5% of stocks are trading above their respective 200DMAsVIX = 28.0Short-term Trading Call: neutral Stock Market Commentary Winners and losers are becoming more and more distinct in the stock market. While skeptics and bears … Read more

LGI Homes: Strong Guidance Builds Hope Against the Housing Downturn

“Despite the challenging environment we encountered at the end of the first quarter, our business was stronger in April than we had originally expected and we are seeing positive momentum in recent sales trends that leads us to believe the impact from the COVID-19 pandemic may be less severe than we had originally expected. We … Read more

Near Overbought Trading Conditions Raise the Stakes On Stock Breakouts – Above the 40 (April 28, 2020)

AT40 (T2108) has effectively soared in a near parabolic move back to the overbought threshold.

Stock Market Statistics AT40 = 69.6% of stocks are trading above their respective 40-day moving averages (DMAs) 3+ month highAT200 = 14.8% of stocks are trading above their respective 200DMAsVIX = 33.6Short-term Trading Call: neutral Stock Market Commentary The stakes are ever higher. Right alongside confirmations of major breakouts from the major stock indices, AT40 … Read more

Bitcoin Faces New Challenge Near A Reversal of Its March Crash

Bitcoin (BTC/USD) has had an interesting – and surprising – relationship with the recent crash in financial markets. Bitcoin fell 39.1% on March 12th just as the crash was accelerating. The S&P 500 (SPY) continued to sell off for another week and a half after Bitcoin crashed. By the time the S&P 500 bottomed Bitcoin … Read more