Posts Tagged ‘narrow market’

A NARROW MARKET IS A DANGEROUS MARKET

A NARROW MARKET IS A DANGEROUS MARKET

Courtesy of The Pragmatic Capitalist 

Africanized Killer Bees are an invasive species. They are very territorial and aggressive. If disturbed they can cause injury or death to animals and man. Mounted Africanized Killer Bee, Apis mellifera adansonii on the right, and common Honey Bee, Apis mellifera mellifera, on the left.

The melt-up continues today as “buy the dip” has turned into “buy the rip”. David Rosenberg is dusting off Bob Farrell’s 10 rules as the market soars:

Not only have sentiment indicators flagged a high level of investor complacency but also the equity market looks highly overbought right now.  Looking at the internals, there is much less buoyancy than there is on the surface.  As an example, back in April there were at least 600 stocks on the Big Board making new highs versus around 180 right now.  Moreover, back at the April highs, we had well over 90% of the S&P 500 universe trading above their 200-day moving average and currently that share is barely above 70%.  Keep these metrics in mind when judging the health and breadth of the overall market, and be sure to dust off Bob Farrell’s Rule 7: “Markets are strongest when they are broad and weakest when they narrow to a handful of blue-chip names.”

But let’s not forget Farrell’s first rule either:

1. Markets tend to return to the mean over time

The Nasdaq 100 has rallied 21% in 7 weeks.  The Russell 2,000 has rallied 20% in 7 weeks.  These are your greed indices.  The ones where the pigs go to die at market peaks.  At the May peak , the Russell was 10% from its 50 day moving average while it is 9% from its 50 day moving average today.  The Nasdaq 100 was 6.5% from its 50 day moving average in May.  Today it is 9.5%! This does not spell impending doom, but the 3 month risk adjusted returns from such a level are very poor.

The risks just strike me as being extraordinary at these levels.  Complacency is high, everyone is bullish, everyone buys every dip, all the news is good, etc.  The pool of greater fools has gotten mighty crowded and my hands are starting to get pruny.  I wouldn’t buy this market with my worst enemy’s nest egg. 


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Zero Hedge

Barrage Of New Countries And Airlines To Adopt Vaccine Passports

Courtesy of ZeroHedge View original post here.

Authored by Steve Watson via Summit News,

Several more countries have indicated that they are to adopt vaccination passports, meaning anyone crossing their borders will need to be able to prove they have been inoculated against coronavirus.

...



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Phil's Favorites

Animal Spirits: Micro Bubbles

 

Animal Spirits: Micro Bubbles

Courtesy of 

On today’s show we discuss:

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ValueWalk

The Fears Of Tech Stocks Underperformace Were Overblown

By Gorilla Trades. Originally published at ValueWalk.

Commenting on overblown fears about the underperformace of tech stocks  and today’s trading Gorilla Trades strategist Ken Berman said:

Q4 2020 hedge fund letters, conferences and more

The Fears Of Tech Stocks Underperformace Under President Biden Were Overblown

Today’s two-faced session hasn’t solved all of bulls’ problems, but the rally tech rally is great news from a long-term perspective. Today’s session might have proved that the fears that tech stocks could underperform under President Biden were overblown, and while cyclicals remained relatively weak, the Nasdaq’s strength could further solidify the bu...



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Chart School

RTT browsing latest..

Courtesy of Read the Ticker

Please review a collection of WWW browsing results. The information here is delayed by a few months, members get the most recent content.



Date Found: Saturday, 11 July 2020, 05:26:16 PM

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Comment: This is lack of liquidity means support is likely to break if it is tested hard!



Date Found: Saturday, 11 July 2020, 09:51:58 PM

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Comment: Nasdaq losing momentum.



Da...

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Politics

What is the 'boogaloo' and who are the rioters who stormed the Capitol? 5 essential reads

 

What is the 'boogaloo' and who are the rioters who stormed the Capitol? 5 essential reads

Rioters mass on the U.S. Capitol steps on Jan. 6. Samuel Corum/Getty Images

Courtesy of Jeff Inglis, The Conversation

In the wake of the insurrection on Jan. 6, the U.S. is bracing for the possibility of additional violent demonstrations and potential riots at the U.S. Capitol and state capitol buildings around the nation. W...



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Biotech/COVID-19

The simple reason West Virginia leads the nation in vaccinating nursing home residents

 

The simple reason West Virginia leads the nation in vaccinating nursing home residents

By mid-January, only about a quarter of the COVID-19 vaccines distributed for U.S. nursing homes through the federal program had reached people’s arms. Paul Bersebach/MediaNews Group/Orange County Register via Getty Images

Courtesy of Tinglong Dai, Johns Hopkins University School of Nursing

The urgency of vaccinating nursing home residents is evident in the numbers. The COVID-19 pandemic has claimed the lives of mo...



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Kimble Charting Solutions

Treasury Bond Yields At Make-Or-Break Decision Point Says Joe Friday

Courtesy of Chris Kimble

Treasury bond yields (and interest rates) have been falling for so long now that investors have taken it for granted.

But bond yields have been rising for the past several months and perhaps investors should pay attention, especially as we grapple with questions about inflation and the broader economy (and prospects for recovery).

Today we ask Joe Friday to deliver us the facts! Below is a long-term “monthly” chart of the 30 Year US Treasury Bond Yield.

Counter-Trend Rally In Yields Facing Strong Resistance!

As you can see, treasury bond yields have spent much of the past 25 years trading in a falling channel… but the coronavirus crash sent yields...



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Mapping The Market

The Countries With The Most COVID-19 Cases

 

The Countries With The Most COVID-19 Cases

By Martin Armstrong, Statista, Jan 12, 2021

This regularly updated infographic keeps track of the countries with the most confirmed Covid-19 cases. The United States is still at the top of the list, with a total now exceeding the 22 million mark, according to Johns Hopkins University figures. The total global figure is now over 85 million, while there have been more than 1.9 million deaths.

You will find more infographics at ...



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Digital Currencies

Bitcoin: why the price has exploded - and where it goes from here

 

Bitcoin: why the price has exploded – and where it goes from here

B is for blast-off (but also bubble). 3DJustincase

Courtesy of Andrew Urquhart, University of Reading

Bitcoin achieved a remarkable rise in 2020 in spite of many things that would normally make investors wary, including US-China tensions, Brexit and, of course, an international pandemic. From a year-low on the daily charts of US$4,748 (£3,490) in the middle of March as pandemic fears took hold, bitcoin rose to ju...



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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Promotions

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Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

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Mike will show off the TradeExchange's new platform which you can try for free.  

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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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