Uncategorized, Weekly Update

The Market Needs Inflation


Published November 15, 2019

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We are shaped by the financial crises we experience. For those of us who lived through the sharp inflation hike of the 1970s, we are forever sensitive to inflation, looking behind every datapoint for evidence of the inflation beast lurking. Over the past decade, inflation has been remarkably steady with the inflation beast long ago tamed. (more…)

Uncategorized, Weekly Update

Markets Shifting


Published November 8, 2019

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As the calendar has turned to the seasonally strong fourth quarter, markets appear to be at important crossroads. After leading the market all year, the more cautious low-volatility stocks might be finally giving way to strength in the more economically-sensitive, higher-beta stocks. (more…)

Uncategorized, Weekly Update

Behind the New High Headlines? A Stealth Bear Market.


Published November 1, 2019

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In the parlance of technical analysis there are two possible explanations for major leaps upward in the stock market. The market is either beginning a new uptrend – a change in market character and trend called an “initiation climax”; or the last gasp of a tired uptrend where sellers have given up and the late buyers rule the day – an “exhaustion climax”. (more…)

Uncategorized, Weekly Update

The Market Spring Is Coiled Up


Published October 25, 2019

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As a follow-on to our note last week are a couple of other technical analysts seeing markets poised to move higher. First, an article from CNBC’s Patti Domm, followed by additional related information from Oppenheimer technical analyst Ari Wald. Bottom line: for several reasons, stocks are ready to jump upward if some positive news bursts forth. (more…)

Uncategorized, Weekly Update

A Weak Economic Report Unsettles Investors


Published October 11, 2019

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The stock market has been going nowhere for four straight months as investors have hoped for a breakthrough in U.S. trade negotiations with China. Most days, stocks are reacting to rumors or vague official announcements regarding the outlook for those trade talks. However, there was one recent hard economic datapoint that caught investor attention. (more…)

Uncategorized, Weekly Update

Contrasting Views Lead to Range-Bound Trading


Published September 27, 2019

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Bond manager PIMCO recently offered their mid-year outlook for the global economy and markets. Their conclusions are:

“In a nutshell, we see a global economy about to enter a low-growth “window of weakness,” which we expect to persist going into 2020 with heightened uncertainty about whether it is a window to recovery or recession. (more…)

Uncategorized, Weekly Update

How Emotion Drives the Economy


Published September 20, 2019

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Finance, and investing even more so, are resting on the foundation of human emotion. How much a stock is worth certainly has some underpinning in the company’s earnings. But perhaps more important is the price-earnings or P/E ratio, which is how much investors are willing to PAY for those earnings. (more…)

Uncategorized, Weekly Update

The Stock Market’s Unspent Fuel


Published September 13, 2019

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Stocks in the U.S. have come roaring back from the weakness of one month ago, returning to the doorstep of new high ground. Lost in the enthusiasm about new highs, however, is the fact that fully half of the stock market has been treading water for almost two years now. If that lagging half of the market were to break through, stocks would be in a position to substantially rally. (more…)