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 win big. The summer of loving stocks continued with the bulls overcoming a major hurdle: the overbought threshold for market breadth. After two failed attempts in the last month, the third attempt became the charm. The charm received a strong endorsement from fresh breakouts by the S&P 500 and the … Read more
Stock Market Commentary: Market breadth almost reached overbought trading territory last week. The Federal Reserve is issuing yet another missive on monetary policy this coming Wednesday. The market’s script is arranged for the potential drama of a collision between the euphoria of overbought trading and a Federal Reserve that is eager to moderate the market … Read more
NVIDIA Races Ahead Money manager Cathie Wood of ARK Invest is known for being unconventional by making concentrated bets on highly speculative companies, what Wood calls betting on innovation that solves problems. So of course Wood has AI-related bets in the various ARK funds. The ARK Autonomous Technology & Robotics ETF (ARKQ) in particular holds … Read more
Stock Market Commentary: The Feds delivered on Sunday as Janet Yellen promised. The FDIC, the Treasury, and the Federal Reserve joined forces to offer emergency financial backing and reassurances for the banking system, a kind of “Project Calm” to project calm. The Federal Reserve even came up with a new acronym that looks like a … Read more
My idea for a trade on the U.S. CPI (Consumer Price Index) report seemed like a great idea last month. Up to that point, the market experienced sharp swings based on the directional gap between the actual inflation readings and expected inflation. I used the Cleveland Federal Reserve’s “nowcasting” to generate an approximate trading model. … Read more
Stock Market and Inflation: Understanding the Impact of the Consumer Price Index (CPI) Report Soon after the Federal Reserve started tightening monetary policy, the stock market started acting like the Fed will see evidence that inflation is actually not a problem and thus plateau or pivot on rate hikes. Yet, the Fed said no in … Read more
Introduction The U.S. housing market follows a seasonal pattern. The spring selling season represents the year’s peak of home sales. During this time, households try to settle into a new home before summer travel or well ahead of the Fall start to the next school year. The stocks of home builders also approximate a seasonal … Read more
Stock Market Commentary: The people of China have now suffered three years of various draconian lockdowns meant to contain the spread of COVID-19. The latest lockdowns remind a suffering populace that there remains no end in sight for this extended kind of public health authoritarianism. Apparently, the frustrations are boiling over enough to motivate people … Read more
Stock Market Commentary: The holiday-shortened week brought a reluctant return to overbought trading conditions. Buyers nudged the indices higher inch by inch after Monday’s slightly down open. The Fed-speak that returned the stock market to bearish trading conditions faded out of view. Looking ahead, the promise of seasonal strength once again beckons reluctant buyers. If … Read more
The United States Oil Fund, LP (USO) has declined six straight Mondays and seven of the last eight. Prior to this streak, USO only declined 39% of Mondays in 2022 (where the market was trading on the prior Friday). Overall, the split is essentially 50/50 with 19 Monday blues versus 20 Monday gains. In other … Read more