Christmas In August Fails to Prevent A Test of the Month’s Extremes – Above the 40 (August 14, 2019)

The S&P 500 (SPY) printed a marginally new low for the month after a 2.9% loss.

AT40 = 26.1% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 40.3% of stocks are trading above their respective 200DMAs (2-month low)VIX = 22.1Short-term Trading Call: neutral (caveats below!) Stock Market Commentary When the S&P 500 (SPY) bounced away from the oversold threshold last week, it left behind an extreme … Read more

Stock Market Trades Near Overbought As the Good Equals Bad Formula Blurs – Above the 40 (July 5, 2019)

Overbought conditions loom as earnings season approaches, and the stock market eagerly anticipates rate cuts.

AT40 = 68.0% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 55.1% of stocks are trading above their respective 200DMAs (essentially matches the 2019 high and is a new 10-month high)VIX = 13.3Short-term Trading Call: neutral (caveats below) Stock Market Commentary Good news is bad news….oops, nevermind The search for … Read more

Rate Cut Promises Rescued A Stock Market Near Oversold – Above the 40 (June 7, 2019)

AT40 = 38.9% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 44.8% of stocks are trading above their respective 200DMAsVIX = 18.9Short-term Trading Call: cautiously bullish Stock Market Commentary From opening at the edge of oversold trading conditions to closing on near panic buying, last week was a wild week! … Read more

Forex Critical – Turkish Lira Gains Fresh Strength on Central Bank and Political Moves

On May 10th, the Turkish lira finally sprung back to life after USD/TRY hit a 7-month high. The move came right on the heels of another move by the Central Bank of the Republic of Turkey (CBRT) to adjust its reserve requirements in a way to support the currency: “Considering the latest developments in financial … Read more

Above the 40 (May 9, 2019) – A Coordinated Yet Precarious Stock Market Dance Around Key Trendlines

AT40 = 45.6% of stocks are trading above their respective 40-day moving averages (DMAs)AT200 = 48.5% of stocks are trading above their respective 200DMAsVIX = 19.1Short-term Trading Call: neutral Stock Market Commentary President Trump carried through on his threat to increase tariffs on China while at the same time tantalizing markets with fresh hope over … Read more

Forex Critical: Mexican Peso Races Past Border Threats

When U.S. President Donald Trump threatened to close the U.S. border with Mexico last November, the U.S. dollar was in the process of making a major top against the Mexican peso (USD/MXN). When Trump threatened a border closure again on March 29th, oddly enough, a minor relief rally in USD/MXN came to an end. At … Read more

Above the 40 (December 24, 2018) – Oversold Chronicles: An Epic Reversal, Historic Depths, and an End to Hubris

AT40 = 3.6% of stocks are trading above their respective 40-day moving averages (DMAs) (oversold day #7, 10-year low!)AT200 = 8.0% of stocks are trading above their respective 200DMAs (9 1/2- year low!)VIX = 36.1 (1-day gain of 20.0%, 10 1/2- month high)Short-term Trading Call: bullish (oh so many caveats below!) Commentary Although it’s been … Read more

Above the 40 (October 10, 2018) – The Stock Market Cascades Down to Oversold Territory

AT40 = 16.7% of stocks are trading above their respective 40-day moving averages (DMAs) (a drop of 14.2 percentage points to an 8-month low and the first day of an oversold period) AT200 = 38.6% of stocks are trading above their respective 200DMAs (a drop of 7.6 percentage points to a 6-month low) VIX = … Read more

Above the 40 (July 20, 2018) – Bored With Economic Wars: The S&P 500 Meanders Through Minefields

AT40 = 57.6% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = N/A% of stocks are trading above their respective 200DMAs VIX = 12.9 Short-term Trading Call: neutral Commentary I remain fascinated by the S&P 500’s increasing resilience to worsening macro-economic headlines. The apparent boredom with the headlines about trade wars, … Read more

Above the 40 (June 20, 2018) – A Stock Market Divergence Made for Bears, Bulls, and Volatile Narratives

AT40 = 65.8% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 55.5% of stocks are trading above their respective 200DMAs (a 4-month high) VIX = 12.8 Short-term Trading Call: bearish Commentary The stock market is oozing with divergences as a result of global trade wars, especially the escalating spat between … Read more