ONE-TWENTY TWO: Trading Financial Markets
Since the year 2000, delivering a different narrative for students and fans of financial markets: stocks, options, currencies, Bitcoin, and more…
The stock market has churned and gone nowhere for 10 trading days, a distinct break in the steady drip upward that saw traders, investors, and even trading-bots seizing upon nearly every dip as a buying opportunity. For six months a very basic equation has dominated: printing money = higher stock prices. For now, a conditional … Read more
The stock market printed a timely and picture-perfect bounce on Friday. Ahead of the rally, I presented the relatively strong case for the bulls based on the previous 3-day pullback. By closing above Wednesday’s high of 1318, the S&P 500 is also poised to continue its gains. However, looking beyond this bounce from support, the … Read more
The risk of holding TBT, the Pro Shares UltraShort 20+ Year Treasury, rose significantly last week. The sudden surge in oil prices in response to the rebellion in Libya has put the double-dip recession back into play and once again lodged it into the frontal lobes of market players. Recession fears bring fresh affinity for … Read more
T2108, the percentage of stocks trading above their respective 40-day moving averages (DMAs), has finally moved higher. For much of 2011, T2108 has lingered just above or just below the overbought threshold of 70% (see my new T2108 resource page). It is now at 74.6%. The last time T2108 was this high was 3 months … Read more
I thought I would get extremely bearish once the S&P 500 reached my upside resistance target of 1300-1310. Yet here we are just five weeks into the year, and the deepest angst I can summon is an uncomfortable sense of “caution.” With T2108 – the percentage of stocks trading above their respective 40-day moving averages … Read more
Throughout the stock market’s meandering upward in December, I maintained that technical conditions were not yet overbought. I also noted that T2108, the percentage of stocks trading above their 40-day moving averages (DMAs), would likely not reach the overbought threshold (at least 70%) until a rush of “panicked buyers” sent the market soaring higher. I … Read more
I have seen and heard several headlines pronouncing that the market is overbought, extremely overbought even. Yet, my favorite oversold/overbought indicator, T2108, the percentage of stocks trading above their respective 40-day moving averages (DMAs), has calmly churned around 60% for almost the entire month of December. The market is typically considered overbought after T2108 crosses … Read more
After the stock market finally tumbled from overbought conditions, I concluded that “…hope remains for bullish wishes, but all the warning signs are tilting comfort levels to the bears.” Bears are now making themselves feel right at home. On Tuesday, the S&P 500 lost 1.6% on higher than average volume, creating the kind of strong … Read more
After 46 days, the stock market finally dropped out of overbought conditions. On Friday, T2108, the percentage of stocks trading above their respective 40-day moving averages (DMAs), plunged below the 70% overbought threshold all the way to 62.5%. The stock market had a historic run. These past 46 trading days created the sixth longest overbought … Read more
Another week, another extension of a historic overbought period in the S&P 500. Based on the closing performance of the stock market’s major indices, you probably would not guess that one of the stock market’s largest companies (Cisco) lost 16% on the day. If there was a day for the market to have an excuse … Read more