Sunday, May 22, 2016

5/22/16 Rock(et)ing Higher



Crowds love to party.  And it's the crowd that elects the politicians that drive the economic policies that will ultimately drive the global stock market to the kind of highs that Boomers are known for.  Impossible?  In my opinion, it's impossible they won't.

Monday, May 16, 2016

5/16/16 Circle Game

Here we go.  The latest story to cross the tape on Marketwatch:

'Wall Street Banks See a Painful Summer for Stocks Ahead'

http://www.marketwatch.com/story/wall-street-banks-see-a-painful-summer-for-stocks-ahead-2016-05-16

Excerpt:

'If you gathered a group of stock analysts in a room, odds are each analysts would have a different view on the market.

'So when analysts from three big investment banks are on the same page, it might pay to listen.

'Bank of America Merrill Lynch, Goldman Sachs and J.P. Morgan are all urging investors to rotate out of equities because they see a painful summer ahead.'

A significant number percentage of investors/traders will read the article, decide it makes sense, and dump their holdings (straight into the hands of prop traders at Bank of America Merrill Lynch, Goldman Sachs, and J.P. Morgan!).  Come October, the global stock index will probably be substantially higher, and the same analysts will recommend buying (pretty much the same shares you sold them back in May!).

It can't be that simple ;)


Thursday, May 12, 2016

5/12/16 Dilma's Done!

At least for the next six months:


Brazil’s iBovespa appears to be consolidating its recent gains (EWZ +1.2% today). 

The global market is doing its best to discourage investors, as illustrated by today’s chart of the DJIA (from +87 points at the intraday high to -86 points at the intraday low to a current print of +53):


Keep in mind that it’s impossible to rally once all investors are on board.  It’s the fund managers and/or retail investors who were left behind that ultimately drive the indexes to new highs.

Saturday, May 7, 2016

5/7/13 Killer Joe/ A Cool Simmer



No one believes in the quietly raging (let's call it simmering) 2016 bull market.  Disbelief is a powerful 'prompt,' enough to spur the DJIA to 20,000 by year end.

The driving bass line in Benny Golson's 'Killer Joe?'  Apart from the bridge, the composition is based entirely on two chords (C7 and Bb7)!  Less is more, and all that jazz.  A beautifully constructed song, one that creates complexity via layers of simple contrasts.

This is one mean market, one that's taking its time setting a bear trap.  It's also one cool market, one that slaps shorts with impunity.  'Hurt me slow, please Joe.'  That's too complicated for me!  Let's just say crowds are known neither for common sense nor rational behavior.

Friday, April 29, 2016

4/29/16 Manic Monday Redux



I like the set up for Monday.  I'll repeat the call I made last Friday, which is that we gap up hard on Monday (and close at or near the high).

Friday, April 22, 2016

4/22/16 Manic Monday



'Manic Monday' started hitting the airwaves in early '86.  Not the kind of stuff I normally listened to, but after countless iterations during my daily commute down US 23 to Milan (MI) the Bangles finally converted me.  It was only this week that I learned the song was penned by Prince.

We had another perfect pullback on Thursday and Friday, the kind that launches further rallies.  My take?  We gap up hard on Monday.

Tuesday, April 12, 2016

4/12/16 It's Not Easy Being Green!



DJIA +182 points.  SPX +22 points to 2064.  EWZ (Brazil) +3% as a congressional committee votes to recommend Rousseff's impeachment.  The iBovespa itself is up +2068 points (+4.12%).  RSX (Russia) +3.27%.  FXI (China 'H' Shares) +1.84%.  EEM (emerging markets) +1.77%.

No commentary needed!