Is It Over? And What To Expect Next

I ended last week's pre-holiday missive with the following: "It is easy to say the bulls are due. Really due." And as if right on cue, stocks proceeded to bounce hard the following session with the Dow Jones Industrial Average enjoying its biggest one-day point gain in history: 1,086.25. Nice.

To be sure, the bounce was to be expected. The market was oversold - as in VERY oversold on - just about every metric. Sentiment was reaching "give up" levels. Technical support zones had been obliterated. Trend measures pointed straight down. Market models flashed sell signals across the board. Everybody was now a bear. And the VIX had finally exceeded the magical 30-mark. As such, once the White House assured everyone that Jay Powell's job was "safe," (and for the record, the Fed Chair can only be fired for "cause" - aka malfeasance) an explosive, sigh-of-relief / short-covering / it's-time-to-go-the-other-way rally began. It will suffice to say that Wednesday was a good day.

But then came the reversal early Thursday morning. In keeping with the current trend, traders wasted little time in returning to the sell button. If you will recall, prior to the big bounce, the game had been to sell into EVERY advance the indices offered - no matter how short or small. So, with the market sinking again, the goodness of Wednesday's algo-induced blast appeared to be at risk.

Well, until 2:30 pm eastern time, that is. At that point, the boys trained their computer toys on the buy side. Word was that some $60 billion in pension money needed to be invested. So, in the ensuing 90 minutes, the Dow surged 860 points. Yowza! Talk about a perfect example of computers chasing their tails.

It was at this point that the, "Is it over?" calls began. ...

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More Than Meets The Eye Happening Here

I attended a holiday gathering for one of my advisor clients on Friday evening. While everyone appeared to be in the spirit of the season, when the conversation eventually turned to the market action, the mood quickly changed.

In talking ...

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Are Investors Now Fighting The Fed And The Tape?

I'm not sure whether it was the late Marty Zweig or his buddy Ned Davis who originally coined the phrase, but it appears that after yesterday, anyone long the stock market may now officially be fighting both the Fed and ...

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Here's Hoping Santa Makes The Trip

It was a very busy weekend in St. Louis, visiting our grandson, daughter and son-in-law, so I'm going to keep the subjective side of this report short and let the models and indicators do most of the talking. But first, ...

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Window "Undressing" May Be At Work

The headlines blared that stocks soared Wednesday in response to improvements in the trade war. Apparently, China was making noise about a new policy designed to increase access to the country's economy for foreign companies. Diving into the story, it ...

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Was That The Soybean Bottom?

It was another wild ride on Wall Street yesterday. Stocks stumbled hard out of the gate, following the lead of most global markets. By 11:00am EST, the DJIA was down more than 500 points, had broken below the October lows, ...

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The Good News: Valuations Are Improving

Due to system maintenance, updates to several key data/models in our indicator boards were not available over the weekend. Thus, our weekly review of market indicators will be postponed until tomorrow morning. But as the title of this morning's missive ...

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All's Well That Ends Well, Right?

The financial press reported that stocks remained "volatile" on Thursday. But since the Dow ended the day with a loss of "only" 79 points and the S&P 500 fell just 4, the attitude appeared to be, all's well that ends ...

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Tariff Man Set The Stage, Then The Machines Took Over

I opined after Monday's "relief rally" that the move had been a bit underwhelming and that uncertainty appeared to have crept back into the market. By Tuesday morning, traders began to realize that Trump may have over-tweeted the trade "deal" ...

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Is Uncertainty Back In The Mix So Soon?

While it may sound strange, perhaps the best word to describe the market action on Monday is, disappointing. Yes, the Dow Jones Industrial Average popped 288 points. The S&P 500 gained 1.1%. The NASDAQ 100 surged 1.5%. And oil jumped ...

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The NEW Daily Decision for 12.3.18 - Fears Fading Away As Santa Loads His Sleigh


The State of the Markets:

Unless you've been living in a cave or don't have access to a TV, computer, smart phone, or even a newspaper, you likely know that Presidents Xi Jingping and Donald Trump laid the groundwork for ...

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Fears Fading Away As Santa Loads His Sleigh

Unless you've been living in a cave or don't have access to a TV, computer, smart phone, or even a newspaper, you likely know that Presidents Xi Jingping and Donald Trump laid the groundwork for a trade deal Saturday night ...

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