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: Throw out all the gradual scenarios for a potential climax. The stock market carved out a quick crest that puts the current rally at risk. Out-performance from small-cap stocks and late saves for the S&P 500 and the NASDAQ barely averted a technical setup for a bearish reversal. The stock market goes … Read more
Stock Market Commentary I gave the summary for the week in my last “Market Breadth” post. I will just add here that the stock charts are full of images of a stock market running low on fuel. I tell just a small part of the narrative below. Stock Chart Reviews – Below the 50-day moving … Read more
Stock Market Commentary Russia’s invasion of Ukraine has created massive human misery and a historic press of global economic sanctions. With war comes scarcity and the allocation of resources to destroying the resources of others. Financial markets are scrambling to adjust to the new global wartime economy. These charts are just a snapshot of some … Read more
Stock Market Commentary Investor psychology took an important hit this week. During the Goldman Sachs (GS) Q&A period for the Q4 2021 earnings conference call, Chairman and CEO David Solomon dropped an inflation bomb. Solomon claimed that “there is real wage inflation everywhere in the economy, everywhere” (from the Seeking Alpha transcript). Solomon responded to … Read more
Stock Market Commentary My bullishness waned with last week’s manic trading action. I called the resulting patterns choppiness toppiness to reflect a biding sense that the market is churning out some kind of lasting top. Still, under the surface of the churn is a fresh divergence. The stock market is full of digital lows and … Read more
Stock Market Commentary The stock market survived a choppy week. The churn almost looked like stabilization after a disappointing start to the new year. However, the attempt to absorb the news of a hawkish Fed is taking its toll in the form of toppiness. With each passing day I get more and more wary about … Read more
Stock Market Commentary The stock market indices benefited from a strong 2021. year. However, under the surface, declining market breadth betrayed the bullish narrative for a wide swath of stocks. A disappointing start to the new year for the indices was even worse for those stocks already limping into the end of last year. The … Read more
Stock Market Commentary The stock market indices enjoyed an impressive year. However, weak and declining market breadth produced numerous exceptions to the strong performance of indices and ETFs. A number of important and well-known individual stocks corrected, collapsed, and crashed in 2021. For some, the tailwinds of the pandemic ran out. For others, investors tired … Read more
A month ago I asked “how long can a parabolic Turkish lira last?” The answer turned out to be a month. However, the path to the end included two false conclusions and a massive blow-off top. The trading in the Turkish lira (USD/TRY) provided a new lesson in parabolic price action. Parabolic trading is inherently … Read more
Stock Market Commentary In last week’s decision on monetary policy, Federal Reserve Chair Jerome Powell directly and fully acknowledged inflationary pressures in the economy. Perhaps lost in the inflation buzz was Powell’s quick commentary on financial stability during the Q&A session: “…asset valuations are somewhat elevated, I would say.” Of course, various folks in the … Read more