Just the facts: For three trading Fridays in a row markets have now sold off hard. Markets have rallied every time after Fed chairwoman Janet Yellen has spoken, yet each rally has been faded. April is about to conclude and what do the charts tell us? Below are 5 charts I think are key in considering drafting a trading strategy & plan going forward. If you’d like more details, daily set-ups/analysis […]
Below is a monthly chart of the Wilshire 5000 index. That’s the entire market. The message: It’s further disconnected from its monthly middle Bollinger band than ever with its RSI exhibiting behavior similar to the previous major market tops which resulted in quick reconnects within a 2 month period. In short: The market is due for a 15% pullback and potentially very quickly: Why quickly? Mid-term elections seasons tend to […]
“One should always be drunk. That’s all that matters. But what with? With wine, with poetry or with virtue as you choose. But get drunk.” – Charles Baudelaire. Well there’s no arguing that stock investors are taking Baudelaire to heart and drunk they are. So drunk it seems they hardly even show up to buy stocks anymore. Wednesday was the lowest print for $SPX options of the year and US […]
Markets put in another ‘V’ bounce performance this past week that looks impressive on the surface with the Trannies putting in new all time highs. Yet sweet new highs are not made of this. In addition to upward sloping $VIX seasonality possibly about to hit markets at a time of historic stretch signs of underlying weakness may reveal this bounce to be more feeble than it appears: Each time the $SPY […]
It is often said that markets are never wrong. Maybe it’s a definitional issue as a market is only the sum of its participants and value is based on perception, but a look at any larger historical chart and it’s clear that markets can overstretch from their historical equilibrium by great distance only to then revert to some level of balance. These deviations can be driven by fear and panic […]
History you may say, may no longer apply. We are a happy central bank family after all. Yellen spoke last week and markets rose and the $VIX dropped back to low 13s on Friday. I turn to darkness my old friend and consult the dormant $VIX and he showers me with a dose of reality and he points to his seasonal May rising with one singular message: A May $VIX in […]
