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 Bears still look ready to bow out, but they still have their paws firmly planted on high-tech stocks, especially semiconductors. The market rotations out of tech are nudging enough stocks higher, especially small caps, to rechallenge the threshold defining overbought conditions for market breadth. The stark divergence in stocks greatly reduces the … Read more
Stock Market Commentary After just acknowledging politics could deliver on-going surprises for traders and investors, both up and down, I certainly did not expect the first day of trading after that post to confirm my assessment. On Sunday, President Biden bowed out the 2024 Presidential campaign and endorsed VP Kamala Harris. The stock market greeted … Read more
Stock Market Commentary Last week ended with an historic tech outage that took down operations around the globe. This event was a poetic punctuation to a week that featured a sharp and toppy end to overbought conditions. The stock market’s tech outage features blow-off tops, double-tops, and some key breakdowns in individual stocks. Still, while … Read more
Stock Market Commentary The latest overbought period lasted two days, a typical duration. However, the start of the period was atypical given the fuel from historic heroics from small cap stocks. The end of the overbought period was remarkable by delivering some of the clearest topping signals of the year. Key indices that soared into … Read more
Stock Market Commentary The NASDAQ is still toppy, but no matter. Small cap stocks are playing the role of super hero. They made a major statement helping to drive market breadth into overbought conditions. These tiny tots turned super hero in historic fashion. Talk about igniting overbought conditions in style! Forget all that talk about … Read more
Stock Market Commentary Last week further emphasized the continuation of notable divergence from Q2 to Q3. This time, soft inflation data caused a surge in rate cut anticipation that in turn drove a significant rotation away from big cap growth and tech stocks and toward small caps and a whole host of other rate sensitive … Read more
Stock Market Commentary The second quarter of the year ended with notable divergence. The third quarter picked up where the second quarter left off. Q3 took the Q2 baton of notable divergence, sending big cap stocks ever higher while leaving most of the market further behind. The jobs report seemed to be strong enough and … Read more
Stock Market Commentary In Q2, the S&P 500 (SPY) enjoyed a 2-month rebound from an April sell-off. The index ended Q2 with a 3.9% gain. The stock market as a whole ended Q2 with a notable divergence in which market breadth, long maligned for the quarter, suddenly improved despite bearish topping patterns appearing on both … Read more
Stock Market Commentary The S&P 500 (SPY) is up 3.0% since summer trading began the day after the Memorial Day weekend. If not for the poor market breadth, the rally would look like a repeat of last year’s summer of loving stocks (sorry sell in May and go away folks). Semiconductor stocks, particularly NVIDIA Corporation … Read more
Stock Market Commentary The stock market’s bearish divergence is too strong to ignore. The S&P 500 and the NASDAQ achieved all-time highs while market breadth sunk again this week. Both short-term and long-term market breadth indicators are at key support levels. Even if market breadth somehow rebounds from current levels, I find myself getting yet … Read more