Stocks had no direction whatsoever on Thursday, same as many of the sessions from the past few months.
There doesn't seem to be any momentum in either direction, but, as the old adage says, "never short a dull market." This being the middle of third quarter earnings season, there will likely be action on the names which are reporting, though moves during such a period are often discounted as mere knee-jerk reactions.
Everything else, bonds, precious metals, oil, also seems to be in a state of suspended animation. Volatility has been wrung out of markets, which is probably a positive, since there are fears of a repeat of last October, when stocks were battered. This being a non-prime election year, perhaps a significant period of calm might be beneficial.
If you think it's easy to write about nothing, the above sentences should prove that it's not.
At the Close, Thursday, October 17, 2019:
Dow Jones Industrial Average: 27,025.88, +23.90 (+0.09%)
NASDAQ: 8,156.85, +32.67 (+0.40%)
S&P 500: 2,997.95, +8.26 (+0.28%)
NYSE Composite: 13,039.23, +44.34 (+0.34%)
Showing posts with label momentum. Show all posts
Showing posts with label momentum. Show all posts
Friday, October 18, 2019
Tuesday, November 13, 2018
Algos Plus Momentum, Herd Behavior Equals Wipeout In Stocks
Monday came as quite a surprise for many investors, as stocks sent a strong message of dislike about something, though nobody is certain just what sparked such a massive selling spree.
For the NASDAQ, it was complete wipeout of last week's gains, minus another 160 points. The other indices were down nearly as much as they were up all of last week.
As noted in Money Daily's Weekend Wrap, technical analysis, showing divergent positions amongst the major indices, was suggesting an imminent breakout in one direction or another. It seems that the market decided to make down the dominant direction... for now.
Volatility, as persisted throughout October, appears not to have abated, more than likely the result of many diverse factors, rather than just one. The increased employment of computer algorithms, combined with the market's distinctive her behavior, manifested as "momentum," produced another of 2018's banner sessions to the downside.
The Dow's 602-point drop was the 15th biggest in market history, but also the seventh largest of 2018, a distinction that will not be lost on market observers. 2018 figures to already be the most volatile year in market history.
All that can be said going into the holiday season is to be guardedly guarded. This time does appear to be different. America is beset by warring political parties in Washington and Wall Street is unhappy, at a time in which stocks are already overvalued and due for a mean reversion.
While this one-day event was a scary sight, it almost certainly will not be the last.
Dow Jones Industrial Average November Scorecard:
At the Close, Monday, November 12, 2018:
Dow Jones Industrial Average: 25,387.18, -602.12 (-2.32%)
NASDAQ: 7,200.87, -206.03 (-2.78%)
S&P 500: 2,726.22, -54.79 (-1.97%)
NYSE Composite: 12,343.51, -194.02 (-1.55%)
For the NASDAQ, it was complete wipeout of last week's gains, minus another 160 points. The other indices were down nearly as much as they were up all of last week.
As noted in Money Daily's Weekend Wrap, technical analysis, showing divergent positions amongst the major indices, was suggesting an imminent breakout in one direction or another. It seems that the market decided to make down the dominant direction... for now.
One might expect these divergences to be resolved in short order, though markets today are guided so much by programmatic trading and headline-chasing algorithms, it's difficult to pinpoint where the breaks are actually occurring and in just what direction they are going to move.
Volatility, as persisted throughout October, appears not to have abated, more than likely the result of many diverse factors, rather than just one. The increased employment of computer algorithms, combined with the market's distinctive her behavior, manifested as "momentum," produced another of 2018's banner sessions to the downside.
The Dow's 602-point drop was the 15th biggest in market history, but also the seventh largest of 2018, a distinction that will not be lost on market observers. 2018 figures to already be the most volatile year in market history.
All that can be said going into the holiday season is to be guardedly guarded. This time does appear to be different. America is beset by warring political parties in Washington and Wall Street is unhappy, at a time in which stocks are already overvalued and due for a mean reversion.
While this one-day event was a scary sight, it almost certainly will not be the last.
Dow Jones Industrial Average November Scorecard:
| Date | Close | Gain/Loss | Cum. G/L |
| 11/1/18 | 25,380.74 | +264.98 | +264.98 |
| 11/2/18 | 25,270.83 | -109.91 | +155.07 |
| 11/5/18 | 25,461.70 | +190.87 | +345.94 |
| 11/6/18 | 25,635.01 | +173.31 | +519.25 |
| 11/7/18 | 26,180.30 | +545.29 | +1064.54 |
| 11/8/18 | 26,191.22 | +10.92 | +1075.46 |
| 11/9/18 | 25,989.30 | -201.92 | +873.54 |
| 11/12/18 | 25,387.18 | -602.12 | +271.42 |
At the Close, Monday, November 12, 2018:
Dow Jones Industrial Average: 25,387.18, -602.12 (-2.32%)
NASDAQ: 7,200.87, -206.03 (-2.78%)
S&P 500: 2,726.22, -54.79 (-1.97%)
NYSE Composite: 12,343.51, -194.02 (-1.55%)
Thursday, March 15, 2018
Dow Sheds For Third Strat Day; Last Week's Gains In Jeopardy
Trade wars. Inflation. Rate hikes. Housing prices. Wealth inequality.
Take your pick. These are but a few of the issues vexing investors as the Dow Jones Industrials recorded triple digit losses for the third straight session, wiping out the gains from the previous Friday and threatening to eviscerate all of the upside from a momentous prior week.
Anybody keeping score (and if you have a pension plan, college fund, or any other kind of tangential reach into the world of equities, you should be) has to be at least a little bit alarmed at the inability of stocks to regain their momentum. After a wildly positive January, February was fraught with panic and pain. Now March is beginning to shape up into a further continuation of the slippery slope upon which stocks are currently sliding downward.
Over the previous week, the Dow had ramped up nearly 800 points, but, as of the current mid-week, the blue chips are down nearly 600 points. Another day like Wednesday would not only eclipse the gains of last week, but it would also signal to chart-watchers a breach of the prior interim low, 24,538.06, achieved March 2nd.
A drop below that level would be an almost certain sign that the index - and stocks in general - are in for another round of relentless selling pressure. What matters little is the suspected cause. What matters most is the evaporation of profits and gains and the spread of fear in the accumulation of wealth.
It would not be the first time that investors had been hoodwinked by snake oil salesmen promoting a path to easy street via investments in minuscule percentage ownership of gigantic corporations. In all likelihood, it would not be the last.
As has been stated in prior posts here at Money Daily, the market is moving not only on money flows and fundamentals, but on political considerations, whether they be real or imagined.
There is very real danger at this juncture and investors would be wise to hold cash and/or take profits.
Dow Jones Industrial Average March Scorecard:
At the Close, Wednesday, March 14, 2018:
Dow Jones Industrial Average: 24,758.12, -248.91 (-1.00%)
NASDAQ: 7,496.81, -14.20 (-0.19%)
S&P 500: 2,749.48, -15.83 (-0.57%)
NYSE Composite: 12,762.67, -69.08 (-0.54%)
Take your pick. These are but a few of the issues vexing investors as the Dow Jones Industrials recorded triple digit losses for the third straight session, wiping out the gains from the previous Friday and threatening to eviscerate all of the upside from a momentous prior week.
Anybody keeping score (and if you have a pension plan, college fund, or any other kind of tangential reach into the world of equities, you should be) has to be at least a little bit alarmed at the inability of stocks to regain their momentum. After a wildly positive January, February was fraught with panic and pain. Now March is beginning to shape up into a further continuation of the slippery slope upon which stocks are currently sliding downward.
Over the previous week, the Dow had ramped up nearly 800 points, but, as of the current mid-week, the blue chips are down nearly 600 points. Another day like Wednesday would not only eclipse the gains of last week, but it would also signal to chart-watchers a breach of the prior interim low, 24,538.06, achieved March 2nd.
A drop below that level would be an almost certain sign that the index - and stocks in general - are in for another round of relentless selling pressure. What matters little is the suspected cause. What matters most is the evaporation of profits and gains and the spread of fear in the accumulation of wealth.
It would not be the first time that investors had been hoodwinked by snake oil salesmen promoting a path to easy street via investments in minuscule percentage ownership of gigantic corporations. In all likelihood, it would not be the last.
As has been stated in prior posts here at Money Daily, the market is moving not only on money flows and fundamentals, but on political considerations, whether they be real or imagined.
There is very real danger at this juncture and investors would be wise to hold cash and/or take profits.
Dow Jones Industrial Average March Scorecard:
| Date | Close | Gain/Loss | Cum. G/L |
| 3/1/18 | 24,608.98 | -420.22 | -420.22 |
| 3/2/18 | 24,538.06 | -70.92 | -491.14 |
| 3/5/18 | 24,874.76 | +336.70 | -154.44 |
| 3/6/18 | 24,884.12 | +9.36 | -145.08 |
| 3/7/18 | 24,801.36 | -82.76 | -227.84 |
| 3/8/18 | 24,895.21 | +93.85 | -133.99 |
| 3/9/18 | 25,335.74 | +440.53 | +306.54 |
| 3/12/18 | 25,178.61 | -157.13 | +149.41 |
| 3/13/18 | 25,007.03 | -171.58 | -22.17 |
| 3/14/18 | 24,758.12 | -248.91 | -271.08 |
At the Close, Wednesday, March 14, 2018:
Dow Jones Industrial Average: 24,758.12, -248.91 (-1.00%)
NASDAQ: 7,496.81, -14.20 (-0.19%)
S&P 500: 2,749.48, -15.83 (-0.57%)
NYSE Composite: 12,762.67, -69.08 (-0.54%)
Thursday, April 21, 2016
With Central Banks Losing Control, Markets Begin Wild Gyrations
In the aftermath of the Deustche Bank revelations that they and other banking concerns engaged in explicit manipulation of gold and silver prices and markets (assuredly, among others), and in anticipation of various central bank announcements, proclamations and policy nonsense, as of today, markets seem to have become somewhat disjointed and erratic.
Witness the madness in precious metals that began in earnest with the opening of the Shanghai Gold Exchange (SGE) daily gold fix priced in yuan, the price of gold shot up $20 when ECB President Mario Draghi left European markets with no new monetary ammunition, and then retreated without reason, ostensibly the controllers in the West reacting to the challenge having been thrown down by the Chinese.
It was a somewhat similar condition in the silver price, which whipped up to $17.65 in early morning trading, only to be slammed down moments later on the NYMEX, below $17. The prices of both gold and silver recovered, but the message is clear: the London gold fixers and those in China are at odds over what should be the true price of precious metals.
There is a solution to this, and that would be to allow markets to work, by outlawing naked shorting, bid stuffing on the CME, high frequency trading and other tools of manipulation. Letting the market decide on the price would be a satisfactory conclusion to what is rapidly turning into an economic war zone, but it is also quite possible the opposing parties could begin using actual guns, bullets, warships and bombs to settle their differences. It is evident that the long-established edge of US monetary hegemony, via the dollar as reserve currency, is coming to an end, and with that, the era of unbacked, unsound money (fiat).
The easiest and most prudent advice to investors at this juncture would be to buy gold - and more importantly silver, since it has been so viciously violated by the bankers over the years - as quickly as possible, and in as much quantity as one can reasonably afford.
US stocks also experienced something of a double dip, once in the early trading and again just before and after noon, which ended up being the move of the day, as the Dow suffered its worst day in three weeks, with the major indices backing off from recent highs, promoted via vapid and obfuscated corporate earnings reports. While the media has been largely hushed over first quarter earnings, the truth of the matter is that most companies are not keeping up with projections, though they are beating lowered expectations. Many companies are reporting positive earnings, no doubt, but they are also lower than what they reported in the year-ago period. Once again, gains in stock prices can generally be attributed to easy monetary policy, cartel-like trading (the same big banks that brought us the last financial crash in 2008-09), and an astounding amount of group-think, wherein nobody bothers with fundamental analysis, but relies more on the whims of the moment, otherwise known as momentum trading.
Get ready for more volatility, as more and more students of the markets realize just how distorted the policies of the various powerful central banks have been.
Today's Closing Numbers:
S&P 500: 2,091.48, -10.92 (0.52%)
Dow: 17,982.52, -113.75 (0.63%)
NASDAQ: 4,945.89, -2.24 (0.05%)
Crude Oil 43.43 -1.70% Gold 1,250.10 -0.02% EUR/USD 1.1289 0.00% 10-Yr Bond 1.87 +0.86% Corn 394.00 +1.09% Copper 2.25 +0.07% Silver 17.03 -0.35% Natural Gas 2.06 -0.43% Russell 2000 1,135.77 -0.57% VIX 13.95 +5.05% BATS 1000 20,682.61 0.00% GBP/USD 1.4317 -0.04% USD/JPY 109.4370 +0.02%
Witness the madness in precious metals that began in earnest with the opening of the Shanghai Gold Exchange (SGE) daily gold fix priced in yuan, the price of gold shot up $20 when ECB President Mario Draghi left European markets with no new monetary ammunition, and then retreated without reason, ostensibly the controllers in the West reacting to the challenge having been thrown down by the Chinese.
It was a somewhat similar condition in the silver price, which whipped up to $17.65 in early morning trading, only to be slammed down moments later on the NYMEX, below $17. The prices of both gold and silver recovered, but the message is clear: the London gold fixers and those in China are at odds over what should be the true price of precious metals.
There is a solution to this, and that would be to allow markets to work, by outlawing naked shorting, bid stuffing on the CME, high frequency trading and other tools of manipulation. Letting the market decide on the price would be a satisfactory conclusion to what is rapidly turning into an economic war zone, but it is also quite possible the opposing parties could begin using actual guns, bullets, warships and bombs to settle their differences. It is evident that the long-established edge of US monetary hegemony, via the dollar as reserve currency, is coming to an end, and with that, the era of unbacked, unsound money (fiat).
The easiest and most prudent advice to investors at this juncture would be to buy gold - and more importantly silver, since it has been so viciously violated by the bankers over the years - as quickly as possible, and in as much quantity as one can reasonably afford.
US stocks also experienced something of a double dip, once in the early trading and again just before and after noon, which ended up being the move of the day, as the Dow suffered its worst day in three weeks, with the major indices backing off from recent highs, promoted via vapid and obfuscated corporate earnings reports. While the media has been largely hushed over first quarter earnings, the truth of the matter is that most companies are not keeping up with projections, though they are beating lowered expectations. Many companies are reporting positive earnings, no doubt, but they are also lower than what they reported in the year-ago period. Once again, gains in stock prices can generally be attributed to easy monetary policy, cartel-like trading (the same big banks that brought us the last financial crash in 2008-09), and an astounding amount of group-think, wherein nobody bothers with fundamental analysis, but relies more on the whims of the moment, otherwise known as momentum trading.
Get ready for more volatility, as more and more students of the markets realize just how distorted the policies of the various powerful central banks have been.
Today's Closing Numbers:
S&P 500: 2,091.48, -10.92 (0.52%)
Dow: 17,982.52, -113.75 (0.63%)
NASDAQ: 4,945.89, -2.24 (0.05%)
Crude Oil 43.43 -1.70% Gold 1,250.10 -0.02% EUR/USD 1.1289 0.00% 10-Yr Bond 1.87 +0.86% Corn 394.00 +1.09% Copper 2.25 +0.07% Silver 17.03 -0.35% Natural Gas 2.06 -0.43% Russell 2000 1,135.77 -0.57% VIX 13.95 +5.05% BATS 1000 20,682.61 0.00% GBP/USD 1.4317 -0.04% USD/JPY 109.4370 +0.02%
Monday, December 9, 2013
No Follow-Through After Big Jobs Report Gains
We've seen this show before, and, it bears witness to the steady downtrend last week that was punctuated by a huge move to the upside on Friday. The non-momentum Monday is the hangover effect of a stock move that was entirely day-trading driven, run on fumes and now run out of gas.
It shows no commitment among traders to actually invest; rather, it solidifies the argument that Wall Street stocks are nothing but casino chips, their valuations unrealistic and devoid of fundamental value, or, at least, fundamentals that would support such stocks at lower prices.
Thanks to Uncle Ben at the Fed we have a completely distorted market that is fueled by creap money and speculation. It was nice knowing Mr. Bernanke, who could step down as early as this week if the Senate confirms Janet Yellen, though she, as replacement, seems even more out-of-touch and reluctant to do anything other than continue printing.
Stocks will keep going up, until they don't, which could be any day now, considering the predictably ugly numbers retailers are set to report this week and throughout the holiday season.
Basically, if one spent today watching the tape, one would have likely fallen asleep.
DOW 16,025.53, +5.33 (+0.03%)
NASDAQ 4,068.75, +6.23 (+0.15%)
S&P 1,808.37 +3.28 (+0.18%)
10-Yr Note 99.20 +0.18 (+0.18%)
NASDAQ Volume 1.54 Bil
NYSE Volume 3.09 Bil
Combined NYSE & NASDAQ Advance - Decline: 2599-3043
Combined NYSE & NASDAQ New highs - New lows: 305-96
WTI crude oil: 97.34, -0.31
Gold: 1,234.20, +5.20
Silver: 19.70, +0.178
Corn: 438.00, +3.75
It shows no commitment among traders to actually invest; rather, it solidifies the argument that Wall Street stocks are nothing but casino chips, their valuations unrealistic and devoid of fundamental value, or, at least, fundamentals that would support such stocks at lower prices.
Thanks to Uncle Ben at the Fed we have a completely distorted market that is fueled by creap money and speculation. It was nice knowing Mr. Bernanke, who could step down as early as this week if the Senate confirms Janet Yellen, though she, as replacement, seems even more out-of-touch and reluctant to do anything other than continue printing.
Stocks will keep going up, until they don't, which could be any day now, considering the predictably ugly numbers retailers are set to report this week and throughout the holiday season.
Basically, if one spent today watching the tape, one would have likely fallen asleep.
DOW 16,025.53, +5.33 (+0.03%)
NASDAQ 4,068.75, +6.23 (+0.15%)
S&P 1,808.37 +3.28 (+0.18%)
10-Yr Note 99.20 +0.18 (+0.18%)
NASDAQ Volume 1.54 Bil
NYSE Volume 3.09 Bil
Combined NYSE & NASDAQ Advance - Decline: 2599-3043
Combined NYSE & NASDAQ New highs - New lows: 305-96
WTI crude oil: 97.34, -0.31
Gold: 1,234.20, +5.20
Silver: 19.70, +0.178
Corn: 438.00, +3.75
Wednesday, January 11, 2012
No News, No Earnings, No Data, No Volume Means Nothing Much for Stocks
The Wall Street HTF machines must have been cranked up to maximum momentum on yet another day without any notable news or data, because stocks, after an early dive into the red, continued an inexorable advance throughout the session, pushing all major indices to positive or flat closes.
Despite Alcoa (AA) announcing in-line earnings on Monday, there haven't been any companies of import releasing full year and 4th quarter results this week. That should all change next week when the market will be inundated with quarterly and year-end reports from a plethora of firms, but so far this week, the markets have had little to move on in either direction.
Instead of pouring into or out of positions, as is often the case in the first few weeks of a new year, traders have been stuck in neutral the past five sessions, and the rest of the week doesn't offer much in the way of market-moving events or news.
The fed released its beige book, detailing what everybody already knows: that the US economy is limping along, unemployment remains a stubborn problem, housing is still weak and December retail was something of a non-event. Even word from the almighty Federal Reserve did nothing to move stocks.
Down 63 points shortly after 10:00 am ET, the Dow finally pushed into positive territory in the final 20 minutes of trading before falling back to red at the close. Leading the slow surge, the NASDAQ had been positive most of the session, with the S&P following the Dow's path, finally finishing with a fractional gain.
One notable item not mentioned around the trading posts was the upcoming debacle of another debt ceiling increase, just five months after the congress and president Obama wrangled over raising the ceiling last August. Our brilliant leaders have managed to blow through some $900 billion in fresh debt since then and will need another rise, which was negotiated in the initial bill.
President Obama is set to ask congress for another $1.2 to $1.5 trillion in a matter of days. The congress will have 15 days to decide whether to grant Mr. Obama his wish. Meanwhile, the debt ceiling will be once again breached, and, after appropriate dummy theater, the congress will oblige. The rhetoric should be especially thick this time around, especially with debate on whether to keep the inappropriately-named payroll tax decrease for the remainder of the year. That deal runs out at the end of February.
Political junkies will enjoy the show; the rest of us will entertain emotions from boredom to disgust. Thank God for the NFL playoffs.
Dow 12,449.45, -13.02 (0.10%)
NASDAQ 2,710.76, +8.26 (0.31%)
S&P 500 1,292.48, +0.40 (0.03%)
NYSE Composite 7,662.17, -6.73 (0.09%)
NASDAQ Volume 1,712,712,875
NYSE Volume 3,965,303,250
Combined NYSE & NASDAQ Advance - Decline: 3208-2391
Combined NYSE & NASDAQ New highs - New lows: 112-36
WTI crude oil: 101.73, -0.51
Gold: 1,639.60, +8.10
Silver: 29.89, +0.08
Despite Alcoa (AA) announcing in-line earnings on Monday, there haven't been any companies of import releasing full year and 4th quarter results this week. That should all change next week when the market will be inundated with quarterly and year-end reports from a plethora of firms, but so far this week, the markets have had little to move on in either direction.
Instead of pouring into or out of positions, as is often the case in the first few weeks of a new year, traders have been stuck in neutral the past five sessions, and the rest of the week doesn't offer much in the way of market-moving events or news.
The fed released its beige book, detailing what everybody already knows: that the US economy is limping along, unemployment remains a stubborn problem, housing is still weak and December retail was something of a non-event. Even word from the almighty Federal Reserve did nothing to move stocks.
Down 63 points shortly after 10:00 am ET, the Dow finally pushed into positive territory in the final 20 minutes of trading before falling back to red at the close. Leading the slow surge, the NASDAQ had been positive most of the session, with the S&P following the Dow's path, finally finishing with a fractional gain.
One notable item not mentioned around the trading posts was the upcoming debacle of another debt ceiling increase, just five months after the congress and president Obama wrangled over raising the ceiling last August. Our brilliant leaders have managed to blow through some $900 billion in fresh debt since then and will need another rise, which was negotiated in the initial bill.
President Obama is set to ask congress for another $1.2 to $1.5 trillion in a matter of days. The congress will have 15 days to decide whether to grant Mr. Obama his wish. Meanwhile, the debt ceiling will be once again breached, and, after appropriate dummy theater, the congress will oblige. The rhetoric should be especially thick this time around, especially with debate on whether to keep the inappropriately-named payroll tax decrease for the remainder of the year. That deal runs out at the end of February.
Political junkies will enjoy the show; the rest of us will entertain emotions from boredom to disgust. Thank God for the NFL playoffs.
Dow 12,449.45, -13.02 (0.10%)
NASDAQ 2,710.76, +8.26 (0.31%)
S&P 500 1,292.48, +0.40 (0.03%)
NYSE Composite 7,662.17, -6.73 (0.09%)
NASDAQ Volume 1,712,712,875
NYSE Volume 3,965,303,250
Combined NYSE & NASDAQ Advance - Decline: 3208-2391
Combined NYSE & NASDAQ New highs - New lows: 112-36
WTI crude oil: 101.73, -0.51
Gold: 1,639.60, +8.10
Silver: 29.89, +0.08
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