ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
On Friday, CNBC’s Fast Money asked the question “Has Goldman Bottomed Out?” The answer to these kinds of questions is always a “maybe” or a more resolute “perhaps/perhaps not” but I was a bit amused at the reasoning provided for guessing that Goldman Sachs (GS) has reached a bottom: It acted well on Wednesday by … Read more
So far this year, EWZ has experienced two 20% corrections from previous highs. The last correction ended in February along with most major stock markets. In late January, I recommended buying EWZ for a trade once it tested its 200DMA. That point of support marked a 20% correction, and it also coincided with the August, … Read more
The most striking characteristic of May’s selling has been the precision of the S&P 500 as it has bounced around key technical levels of support and resistance. On these pages, I have chronicled almost each important step and juncture in this sell-off, and I continue to marvel at how well trades have fared that stay … Read more
Big-cap tech stocks have been some of the poorest performers during the recent sell-off in the stock market. Google (GOOG) stands out as one of the worst of the bunch. All technical indicators are pointing to even lower prices before some kind of bottom gets established. I am fond of trading GOOG between earnings reports. … Read more
I last wrote about Research In Motion (RIMM) in mid-April when I asked “Can RIM’s Stock Continue to Float As the Repurchase Program Ends“? The resounding answer is now “NO”. RIMM is down 17% since mid-April and has set new lows for the year. RIMM repurchased the bulk of its stock at an average price … Read more
For 14 months the S&P 500 has trended upward from the March lows. However, with the S&P 500 now down 3.9% for the year, the last 8 of these 14 months have produced no net gain in the index. Another 3% drop will produce the first lower low on the index since July, 2009. The … Read more
The percentage of stocks trading above their respective 40-day moving averages, T2108, closed at 19%, below the 20% threshold that indicates an oversold stock market. The stock market has reached these levels only one other time since the March, 2009 lows – this was in February when the market last cared about the sovereign debt … Read more
It has been such a long time since I have seen the Fast Money crew on CNBC so uniformly fearful and wary about the stock market that I had to scribble a quick post on it as a bookmark for future review. The show’s sentiment is very consistent with the confluence and convergence of technical … Read more
Last week, I claimed that the deeply oversold conditions presented a short-term buying opportunity, but that the downward trend in the percentage of stocks trading above their respective 40-day moving averages (DMAs) and 200DMAs (T2108 and T2107) pointed to a steadily weakening market in the near future. I expected sellers to step up at the … Read more
“…I stick by the rule that low-volume buying begets high-volume selling; weeks of gains can be erased within a manner of days once sellers finally get motivated.” This quote came from my commentary in late March titled “Some Lazy Thoughts for a Complacent Market“. At the time, I was reacting to the extreme overbought technical … Read more