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 stock chickens have come to roost on declining market breadth. The stock market indices still generally appear fine, but an ever growing swath of individual stocks have fallen further and further behind. Last week in particular, sellers delivered an extended beating on individual stocks. The signs of waning confidence in the … Read more
Housing Market Intro and Summary The housing data for April and now May confirm that the housing market had a kind of false start to the Spring selling season. Normalization continues to pressure short-term trends. Housing starts, new home sales, existing home sales, and home builder sentiment are in key downtrends. These measures are now … Read more
The Downgrade Zelman & Associates gut-punched home builder stocks with a major downgrade of the sector on June 10th. Zelman used a survey of builders to conclude that soaring housing prices are reducing demand. The survey also revealed “a fourth straight month of weaker-than-seasonal order activity in May”. (I have covered this dynamic as “normalization” … Read more
The Follow-Through: Churning While the S&P 500 (SPY) cruised higher all week, much of the rest of the market resigned to churning. The dichotomy of a market rebound versus the wounds left to heal continued to play out. Many of the follow-through trades for this week churned with the rest of the stock market. See … Read more
The Follow-Through Intro The stock market followed a rare stumble with a broad-based rebound from “oversold enough” conditions. Stocks were generally up across the board as buyers rushed in to grab “bargains.” AT40 (T2108), the percentage of stocks trading above their respective 40-day moving averages (DMAs), jumped from 37% to 46%. My favorite technical indicator … Read more