The S&P 500 has been in a pattern that is considered bearish by some market observers. This pattern plays off of an old theory suggesting that “dumb money” trades in the morning, while “smart money” trades in the afternoon. Here is how it works: Dumb money is thought to move in the morning. Retail investors Read More
NASDAQ losing momentum – what that means to investors
The Nasdaq appears to be losing momentum as it attempts to break old highs near 12,000. Take a look at the momentum studies under the price chart below. Note the direction their trends display. Near termed (stochastics), mid termed (RSI) and longer termed (MACD) momentum are all diverging negatively as the market toys with its Read More
Airlines: a contrarian opportunity or a sector to avoid?
Here’s a chart illustrating passenger traffic at airports since the COVID crash. I took it from a Wolfstreet.com article in late Sept. focusing on the proposed airline bailout. Note that airline passenger attendance is down in the same period year-over year (red line), but interestingly, didn’t see the same drop-offs in travel on July 4th Read More
4 ways to help offset US election volatility
An uncontested election seems to be priced by the stock market…which is interesting when you consider that both sides (Trump/Biden) have stated they will contest a close election. A contested election would likely result in a short termed stock market selloff in early November. Thus, in my view, we should consider how we might manage Read More
Is energy the next big contrarian trade?
Oil is setting up to be a potentially powerful contrarian trade. Keep in mind that all contrarian trades are risky. But, with risk, comes reward. Oil is experiencing a high level of capitulation vs. other cyclical equity sectors like metals etc. The bull case Clearly, a Trump win in November would aid the oil sector, Read More
Expect volatility, and opportunity
The Bear-o-meter is a compilation of technical, seasonal and value indicators that I have been using for many years. It helps determine the risk/reward opportunities (or lack thereof) on the US markets. It measures various metrics against the SPX and Dow indices. Do a search on Bear-o-meter in the SmartBounce search engine if you wish Read More