ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
AT40 = 66.1% of stocks are trading above their respective 40-day moving averages (DMAs) (ended 1-day overbought) AT200 = 55.5% of stocks are trading above their respective 200DMAs (a 4-month high) VIX = 12.9 Short-term Trading Call: bearish Commentary Flipping short-term bullish was fun while it lasted…all of two days. The Federal Reserve hiked interest … Read more
The fundamentals have changed little. Sentiment is making a dramatic shift. The last Housing Market Review covered data reported in April, 2018 for March, 2018. At the time, I lamented a dissonance of decelerating housing data and diverging home builder stocks. Over a month later, the deceleration is a little less pronounced while the divergence … Read more
AT40 = 66.9% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 54.3% of stocks are trading above their respective 200DMAs (a near 4-month high) VIX = 14.9 Short-term Trading Call: neutral Commentary Oh the hazards of changing short-term trading calls in this churning market! Reluctantly, I switched my short-term trading … Read more
When Lennar (LEN) reported earnings on April 4th the market’s reaction looked just like the refresher the market needed to get housing stocks going again. LEN soared 10.0% on the day. The deal looked sealed when LEN appeared to confirm the surge with another up day. LEN has suffered severe selling pressure ever since. Source: … Read more
The last Housing Market Review covered data reported in February, 2018 for January, 2018. At the time, I connected the dots on the bearish implications of converging technicals and fundamentals. The iShares U.S. Home Construction ETF (ITB) broke down below its 200-day moving average (DMA) in a very bearish move. Yet, the very next day, … Read more
AT40 = 45.9% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 44.0% of stocks are trading above their respective 200DMAs VIX = 17.4 Short-term Trading Call: neutral Commentary The S&P 500 (SPY) gained 2.0% for the week. Yet the week felt like a loser given the way it ended. The … Read more
The ink just dried on my last Housing Market Review. In that piece I lamented the on-going lagging performance of home builders and stagnating housing housing data, and thus concluded that it was time to call an end to the seasonal trade on home builders. Just two days later, home builders surged upward in sympathy … Read more
The last Housing Market Review covered data reported in December, 2017 for November, 2017. At the time, the iShares U.S. Home Construction ETF (ITB) was still recovering from a small dip caused by an earnings report from Toll Brothers (TOL) that disappointed the market. Housing data were strong and pointed to on-going bullishness. January launched … Read more
AT40 = 23.4% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 47.8% of stocks are trading above their respective 200DMAs VIX = 30.0 (19.7% decrease, intraday high of 50.3) Short-term Trading Call: neutral Commentary The first oversold period in about two years ended after just one day. As a reminder, … Read more
In my last review of the housing market, I ran out of time to comment on an emphatic statement from the National Association of Home Builders (NAHB) regarding its failure to influence the Republican plan for tax reform. The tax plan coming out of the GOP side of the House of Representatives includes a provision … Read more