Lower (swing) Highs and Lower Lows October 21, 2023
Posted by Tom in Thoughts.add a comment
Oct. 20, 2023 Short and Sweet –
The broad definition of a Downward Trend: Lower Swing Highs and Lower Swing Lows.
The broad definition of a Upward Trend: Higher Swing Highs and Higher Swing Lows.
On my weekly charts, the closing low on Friday was darn near critical point where thing could get ugly; not that they must, but could. Most traders / investors should be in Cash looong before now and longer term should be “Dancing Near the Door”.
This market is volatile! It is reacting to just about any news or news conference; a sign of a weak market . . . “it cares”. (A strong market would be indifferent.)
Have a good week. ……………. Tom ……………
Taking A Step Back October 15, 2023
Posted by Tom in Thoughts.Tags: market analysis, market commentary, Stock market analysis, stock market commentary, technical analysis
add a comment
Oct. 13, 2023 – OK . . I got 6 responses to my question last week about whether to continue this blog. That’s “OK” but not exactly great. Since I want to spend more time on research and less on communicating general market thoughts I’ll continue, but take “A Step Back”. That is, instead of “religiously” publishing every week (no matter what), I’ll put out my thoughts when it looks like something significant is, or may happen. In that way it should make better use of my time and yours too. The best way to see if there anything new is to subscribe to new posts. That way you’ll get an e-mail notification. Hopefully this makes sense . . . . in any case . . . . you can’t “beat the price”. 😊
On we go. Last week major Wall Street banks reported earnings for the 3rd quarter. Earnings were up, driven mostly by higher interest rates (those that they charge). But the number of delinquent loans is starting to increase. Perhaps storm clouds of a recession or at least a slowdown. The Consumer Price Index (CPI) remains hot, down a little, but still high. Inflation continues to look “sticky”. Overall market liquidity is reduced due to the high bond issuance as investor put money to “work” in bonds and not equities.
Click on Chart to Enlarge it
We got back into the Trading Zone and usually, the market “should be” positive going into the end of the year. The problem is: Hamas / Israel, Ukraine / Russia, weakness in China and (dare I say) the Republicans in Congress. These are all major obstacles to a higher market. (I note that China is selling US Treasury Bonds to get Dollars to prop up the Yan.) A lot of head winds in the coming month.
The only sector doing OK is Energy. The Short Term Sector Strength Table is shown below –
I remain heavy in Cash. If Congress shuts down the government, US loans will be rated lower, our interest rate rise and it will cost more for everyone to borrow. That’s not the way to “lower the deficit”; just say’in. Hopefully some 8-12 Republican Congress people figure this ECON 101 fact out soon. (Yes, this sounds like an editorial, but it is also fact. Heck . . they can’t even agree on a leader.) Watch the US $ and the T-Bonds. They will be a clue as to strength or weakness. (High $ is Bearish, as is Lower Bonds; higher rates.)
In the meantime, have a good week and be careful of a news whip-saw. It’s coming. As always, take small initial positions, you can always add to them if they prove correct. Cheers. ……… Tom ……….
Continue On ? ? ? October 8, 2023
Posted by Tom in Thoughts.Tags: investing, market analysis, market commentary, market direction, Stock market analysis, stock market commentary, technical analysis
1 comment so far
October 6, 2023 – First off, I’ve been doing this blog for over 5 years and it may be time to take a rest. My question to readers is: Do you find this useful and of value? If so, please click on the “Add A Comment” section at the top and leave me a short response (like “please continue”), other wise since my subscription to Word Press is coming due shortly, I may just take a hiatus and stop for a while. Let me know please.
Well now . . . on Friday we got some very strong jobs data and initially the market dropped for an hour because very good news is “bad”; the FED will raise interest rates and keep them there longer. Then folks settled down and thought that maybe good news means the economy could pull off a “soft landing”; up it went recovering previous losses.
Click On Chart to Enlarge It
The market has fallen out of the “Trading Range” but made a one-day recovery on Friday. I note the low volume as nobody seems to be 100% convinced that the worst is behind us just yet.
In any case the US indexes did gain a little for the week with the exception of the small cap Russell 2000, which many consider a riskier set of stocks. Next week could be interesting to see how market react to the Palestinian – Israeli conflict and a test of whether this localized swing bottom actually holds. I would not be surprised to see one more push lower before a consolidation range builds into late October for a move back higher by the end of the year. I just feel that this market wants to fake out as many folks as possible before resuming a trend. A quick move down would ‘do it’ before the “smart money” comes back in. Just a theory at this point. The rest of the year should be traditionally positive from mid-October on.
That’s it for now. Please respond to my request to readers and we’ll see what develops. Have a good week. … Tom …
Special Risk Capital Management LLC 
Half of 2023 Gains Lost October 28, 2023
Posted by Tom in Thoughts.Tags: active portfolio management, market analysis, market commentary, market direction, Stock market analysis, stock market commentary, technical analysis
add a comment
October 27, 2023 – At the close of this past week have lost nearly ½ of the gains made in 2023 (NASDAQ Composite Average). That goes back to mid-may levels. The S&P 500 Index is about the same (early February & May of this year). I’ve heard that the NYSE Index has lost all of it’s gains to date.
The Double Whammy:
The market doesn’t like uncertainty. Add to that the geo-political wars and you could call it a “Triple Whammy”.
I remain heavy in Cash and some high yielding closed end funds & ETF’s. (We are closer to the rate top than the bottom; patience.) No one will signal the market low, so scale back into it as there will likely be a base of consolidation forming that will provide time to re-enter.
Click On Chart to Enlarge It
Share this: