Morning Comment: Housing stocks breaking out.

  • When trying to figure out how the market will react to an “highly anticipated event,” it’s important to note how the stock market has acted BEFORE this “event” takes place.
  • Despite a slow down in domestic economic growth, the ITB home construction ETF has broken out of its sideway range to the upside. Any upside follow-through will confirm the breakout…and be quite bullish for the group!

The market "set up" is important before "highly anticipated events."

From time to time we get a highly anticipated event in the market place. When this happens, the reaction in the stock market to the news that comes out of that “highly anticipated event” (like a key data point or an important speech/testimony) can frequently be determined by the “set up” in the markets BEFORE this event takes place.

For instance, a large decline in front of an “highly anticipated event” can soften the move in the markets after we get the actual news from that “event” if the news is bearish. It can also create an outsized rally if the “news” is much more bullish than expected…..On the flip side, if the market has seen a strong rally just before the “highly anticipated event,” it doesn’t leave the market a lot of upside potential if the news is bullish…and leaves it vulnerable to an outsized decline if the news is surprisingly bearish.

The recent "set up" limits near-term upside potential.

Of course, if there isn’t much movement before these highly anticipated events take place, the reaction can still be a big one if we get a big surprise, but that’s not the situation we’re facing right now. The “highly anticipated event” we’re facing right now is tomorrow’s speech from Fed Chairman Powell in Jackson Hole. The stock market has rallied 3.5% over the ...

Read More

American Express (AXP): Close to important support on the chart

AXP has outperformed nicely since the December lows…as it rallied almost 44% from those lows to its July highs. However, it has rolled over a little bit recently.

The decline took AXP below its trend-line from last year’s low. The ...

Read More

Morning Comment: Too much blame on the Fed.

  • We agree with many of the President's policies, but....
  • The trade war IS having a negative impact on the economy
  • Let's look past the politics
  • Way too much blame on the Fed for the slowing economy
  • The trade is THE ...
Read More

Morning Comment: Gold overbought near-term.

The bounce in the S&P 500 still faces headwinds

The recent bounce in the S&P 500 index has been impressive. However, it still faces serious headwinds and I believe a deeper correction of 10%-15% is likely over the next two ...

Read More

Morning Comment: Russell 2000 testing important support

Trump has egg on his face

Well, the Great Negotiator has egg all over his face. President Trump gave China something for nothing when he delayed his announced tariffs…and China paid him back by shoving it right up his butt. ...

Read More

Morning Comment: It's Rarely Different This Time

  • Trump wimps out again.
  • More head winds than when Trump's last flip-flop took place.
  • The lag between "inversion" & recession is irrelevant.
  • It's rarely "different this time."

Trump wimps out

President Trump has backed-off once again on his tariff threats...and ...

Read More

The Weekly Top 10: Lower-lows Ahead.

  • A major shift has taken place in U.S. foreign policy that will impact global markets for years to come.
  • The recent bounce in the stock market is a "dead cat" bounce and lower-lows are on the way.
Read More

Morning Comment: Something HAS Changed.

The first low is rarely the ultimate low when we get "new-news".

The market has seen some wild swings in the last week…and the recent bounce in the stock market has been quite impressive. However, we need to keep things ...

Read More

Morning Comment: Chips Stocks at Key Level.....Ditto for Gold

  • Chairman Powell seems like a deer caught in the headlights
  • SMH down 5%, next move will be critical
  • Gold looks great longer term, but.......

Chairman Powell seems like a deer in the headlights

Chairman Powell (and the Fed) don't seem ...

Read More

Morning Comment: Apple, Netflix & Boeing all face key technical levels

  • Quiet day today until we hear from the Fed.
  • Apple's chart looks excellent.
  • Netflix stands at a critical technical juncture.
  • Boeing needs to hold $340 to avoid further problems.

It should be very quiet today until the Fed's announcement

It's ...

Read More

Morning Comment: European Banks on the Brink?

What do they know that we don't know?

Twice now…over the past several weeks…we’ve asked the question, “What do they know that the rest of us don’t know?”…..We first ask it when the Fed sent out definitive signals that they ...

Read More

Morning Comment: Big Week...and Bitcoin Testing KEY Support

"Summer doldrums" are very unlikely this week

You’d think that the last few days of July and the first days of August would be prime-time for the “summer doldrums,” but this year, it has the potential to be one of ...

Read More