Morning Comment: U.S. Open Tennis--Yes; Wimbledon--No. Actually, It Makes Perfect Sense.


Chairman Powell’s comment yesterday that the Fed will “slow their bond buying program as the markets improve” knocked the stock market down mid-morning. On Monday, the Fed’s announcement that they are going to buy individual corporate bonds as part of their newest QE program gave investors the feeling that the Fed was going to keep the pedal to the metal even if things calmed down going forward. So yesterday’s comment from Mr. Powell seemed to throw some water on that thought. However, the decline was a short-lived one...and the S&P 500 was able to recover 2/3 of what it gave back in the morning by the close...and finished almost 2% higher for the day. The rally came on excellent breadth (13 to 1 positive on the S&P 500), but the volume was on the tepid side.

There is no question that this week’s action has been very good so far, but it’s not enough to declare that the “critical juncture” we’ve been talking about recently is going to resolve itself to the upside. This is not a concern because we’ve been expecting that it will take a couple of weeks before we’d know how this situation is going to resolve itself. We’re still going to have to see either a meaningful move above the early June highs of 3232 on the S&P...OR a meaningful drop below its 200 DMA (near 3000) before we get any definitive resolution to this “critical juncture” in the stock market.

Of course, the much better-than-expected month-over-month retail sales number had a hand in yesterday’s rally...as did the news that the Trump administration is going to propose a $1 trillion infrastructure plan. More importantly, the fact that the year-over-year retail sales numbers were down significantly...& the fact that the House Democrats will never give the President ...

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THE WEEKLY TOP 10....The Next Few Weeks Are Critical


THE WEEKLY TOP 10: The Next Few Weeks Are Critical.


Table of Contents:

1) We’re going to have to rely solely on stimulus for a further rally in stocks after the big run-up.

2) The problem is that nobody ...

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Morning Comment: The Action of the Next Few Weeks Will be Critical


With the stock market becoming quite overbought on a near-term basis, we have been saying this week that we expected the stock market to begin a pull-back after the Fed meeting/press conference, but we didn’t expect to quite as immediately ...

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Morning Comment: Watching the Aussi Dollar


The rally we saw in the stock market after Friday morning’s employment report was a very good one on several levels. It came on a big jump in volume (over 7bn shares on the composite volume) and very good breadth ...

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Morning Comment: Critical levels...Stay nimble my friends.


About a week ago, we said that the best thing that could happen to the stock market would be it to take a “breather” before it continued much higher. That, we said, would give it a better chance of rallying ...

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Morning Comment: Can European Stocks Be The Big Surprise of This Summer?


We’ve all starting to hear a lot of comparisons between this year and 1968 now that racial tensions and riots have been added to the list of other wild developments for 2020. It sure seems like President Trump is taking ...

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Morning Comment: BAC breaks out....Complacency surrounding China


We’d like to start this morning’s piece with a scenario that would provide the best chance of a strong (further) rally after yesterday’s advance in the S&P 500 above its two key resistance levels (its 3,000 level and its 200 ...

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Morning Comment: A look at the chip stocks....and gold.


A big bounce in the bank stocks created a very strong reversal in the broad stock market yesterday…and helped the S&P 500 rally 3% off of its early morning lows and close more than 1% higher on the day. The ...

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Morning Comment: Very Simply, Follow the (Smart) Money


Well, we can add another billionaire investor to the list of those who believe the stock market is going to see another decline. Stan Druckenmiller says the risk/reward for equities is the worst he’s seen in his career. To repeat, ...

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Morning Comment: Can the Fed Solve the Economic Problems With Liquidity This Time?


The golf courses here in the People’s Republic of Massachusetts finally re-opened this past weekend. It was funny. For the first time in history, husbands played golf with their friends on Mother’s Day. Previously, in order to preserve domestic tranquility, ...

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Morning Comment.....BABA: A leading indicator for future global growth?


The markets seem to come to a stand still yesterday…as the volume was even lower than Friday’s and the average volume of the past two days has been more than 25% below it two month average. The fact that the ...

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Morning Comment: Follow the (smart) money


The stock market got rocked pretty hard on Friday after several key companies reported earnings and tensions between the U.S. and China began to rise again. The 2.8% decline in the S&P 500 came on horrible breadth (17 to 1 ...

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