ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
Sellers stepped out of the way today. Although volume was generally low on the major indices, stocks managed large gains that made up for yesterday’s ugly close and much more. In fact, today was the kind of day I was anticipating for yesterday’s trading. Stocks in my listing of potential buy candidates for this oversold … Read more
(This is a guest post written by “Chenzo” of forexcharts.net) If any lesson was clear during the past few turbulent weeks of trading, it was that our markets are more closely entwined than ever. Perhaps this is a sign of our continuing globalization path, but the waves created by any financial event are traveling across … Read more
After a disappointing Monday, bulls got a good scare on Tuesday’s open as the S&P 500 marginally cracked the February lows. However, buyers stepped up in force and bid the index higher for the rest of the day. Buyers have now stepped up in force for the last two up days. With this oversold period … Read more
Until the ugly close on the stock market, Day #4 of this oversold period was as lackluster as I expected. T2108, the percentage of stocks trading above their respective 40-day moving averages (DMAs), nudged up a bit to 11.7%. For a while there, it seemed as if the latest dire headlines from Europe – this … Read more
The most striking characteristic of May’s selling has been the precision of the S&P 500 as it has bounced around key technical levels of support and resistance. On these pages, I have chronicled almost each important step and juncture in this sell-off, and I continue to marvel at how well trades have fared that stay … Read more
The percentage of stocks trading above their respective 40-day moving averages, T2108, closed at 19%, below the 20% threshold that indicates an oversold stock market. The stock market has reached these levels only one other time since the March, 2009 lows – this was in February when the market last cared about the sovereign debt … Read more
It has been such a long time since I have seen the Fast Money crew on CNBC so uniformly fearful and wary about the stock market that I had to scribble a quick post on it as a bookmark for future review. The show’s sentiment is very consistent with the confluence and convergence of technical … Read more
Last week, I claimed that the deeply oversold conditions presented a short-term buying opportunity, but that the downward trend in the percentage of stocks trading above their respective 40-day moving averages (DMAs) and 200DMAs (T2108 and T2107) pointed to a steadily weakening market in the near future. I expected sellers to step up at the … Read more
Although the S&P 500 almost touched its high for the year on its eighth up day out of the last nine trading days, the VIX (the volatility index) increased almost 4%. So, as the S&P 500 scrapes at fresh 18-month highs, the VIX is bouncing from 21-month lows. The chart below shows the current action … Read more
Last week, I suggested that T2108 was at such low levels that the next spike in the VIX would represent a major buying opportunity. Sure enough, the VIX printed only its second higher high of the entire rally off the March lows and buyers rushed immediately into the market (put sellers probably also rushed in … Read more