ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
Excitement over earnings almost trumped technicals today. The S&P 500 tipped over and then faded back ever so slightly from its 50-day moving average (DMA). Earnings news typically trumps technicals, but I was pretty convinced looming overhead resistance would hold firm no matter then news given the weak buying volume coming into today. Buying volume … Read more
Almost on schedule, the pendulum has swung back to “sell” on the S&P 500. The technical setup on the index shows extremely overbought conditions with buying volume falling just as the index reaches for overhead resistance (see chart below). Combine these conditions with the launch of earnings season, a new round of U.S. economic releases … Read more
It took a little patience, but the bounce from oversold conditions delivered in spectacular fashion on Wednesday with a 3.1% jump. The setup this time was a “bullish hammer” that formed ahead of the U.S. unemployment report last Friday. This is how I described the setup at the time: “The good news is that the … Read more
If the summer ends up trading in a range, it will have a wider berth than I had expected. This week the S&P 500 broke both closing and intra-day lows for 2010 and confirmed an unfolding downtrend. The index is down 8 of the last 9 days. The good news is that the S&P 500 … Read more
The first half of 2010 has ended and another earnings season is upon us. The second quarter should be a time of easy comparisons as the economy hit a trough leading into spring of last year. If there is any credence to the argument that the economy is on a sustainable path to recovery, we … Read more