ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
If the housing market remains strong through 2021, Meritage Homes (MTH) may be one of the best catch-up trades in the cohort of major home builders. MTH hit an all-time high 4 months ago in October. Since September, MTH’s valuation has dropped from 2.0 (expensive!) price/book to 1.4, 1.1 price/sales to 0.7, 12.8 to 8.1 … Read more
Housing Market Intro and Summary “…the level of housing activity is at its highest level since before the global financial crisis in some measure. So we’ve had a very strong rebound in housing. Some of the tightness in housing markets — which has led to the significant price increases this year — we think is … Read more
Stock Market Commentary The Presidential inauguration is a hallowed American tradition. The stock market celebrated the incoming Biden and Harris administration with new all-time highs on good trading volume. The start of a new American administration is as good a time as any to back down from my recent short-term bearish call. While this overbought … Read more
Stock Market Commentary The weakening overbought conditions finally gave way to a full breakdown. The abrupt end of the overbought period ushers in the bear. Ironically, trading started well with the S&P 500 (SPY) gapping slightly higher at the open. The selling pressure started after the open and did not relent until lunchtime on the … Read more
Stock Market Commentary The stock market quickly moved away from its close call with overbought conditions to pulling off a refresher for extended overbought conditions. The acquiescence of President Trump in signing a heavily negotiated, highly contentious pandemic relief bill seemed to provide the spark for the buying in the major indices. The Stock Market … Read more