More Internal Pain
By · CommentsI mentioned yesterday seeing breakouts crumble even though the overall market crept up. I also made the point that things “felt” like 2007 when the market crawled up but internally felt sick.
More evidence today of that. Breakouts were crushed, some stocks that merely met expectations got slapped (eg RVBD) and Peter Brandt who runs an excellent trading blog pointed out that the Baltic Dry Index (the shipping index) was making new lows- something that shouldn’t be happening in an expanding global economy. The market popped for ONE day after Bernanke spoke, which is much less reaction than the 6 month rally we got the last time he pledged big action. However, I will hypothesize that just his words won’t move markets much. I think people want to see OVERT Fed action. But I could be wrong and my judgement could be too quick.
Gold stocks followed on a bit day with gains that were “tame” compared to yesterday’s fireworks. Tech didn’t look so good and some companies Read More→
Uncle Ben to the Rescue
By · Comments1/25/12
I mentioned last night wanting to wait til 10:30, 11:30, 2:30 etc to see how the market would go. Apple had already announced an awesome quarter so that stock was up about 9% in the aftermarket. But things didn’t really get going til old friend Uncle Ben Bernanke gave asset prices the green light by pledging another 2-3 years of ZIRP – Zero Interest Rate Policy. Then the party started.
Gold stocks launched – and I mean launched – with many of the the mid cap companies rising 6-10% on the DAY. The large cap miners like Goldcorp, rose almost 7%. Gold itself rose just under 3% with silver up about 4%. Perhaps it’s finally time for the miners to outperform the metal. I think with the all clear from Helicopter Ben, investors will feel safe buying. It also gives a green light for foreign currencies, until central banks worldwide try to fight back (Currency Wars), and foreign stocks as emerging markets rose across the board. Copper took the cue also and rose.
I am curious to see if an Uncle Ben rally could last as long as the last one. Remember in August of 2010 when Read More→
More Blah (except for Apple wow)
By · Comments1/24/12
Another unexciting day in the markets – though what I am noticing is that many stocks that were down going into the end of 2011 have strongly reverted to the mean with many deep value stocks moving up 10-40%. Today’s edition was EMC, which moved up over 7% today right to the breakout point of the double bottom base and rested there. EMC was helped by good numbers from VMware – which is over 80% owned by EMC.
A Word About Apple
iPads everywhere
The big news was Apple reporting their results after hours. It seems that either everyone now owns an iPhone and iPad or some very devoted fans own 2-3 of each because their numbers were huge. Cross selling is likely running rampant as many iPhone owners are probably Read More→
Deflation, Inflation?
By Chris Grande · Comments (0)Friday’s (1/27/12) action was not too exciting, though some breakouts held (BodyCentral). I don’t watch the entire market FYI (can’t follow 10,000 stocks) but I try to get an idea for what’s happening with a sampling of stocks. Perhaps BODY’s issue was getting past lockup and with no serious selling pressure it rose. The company has been doing well selling to the fickle teen/young 20-something set which requires a company to be right on the cutting edge with great affordable styles (Think Forever 21 – a company I’d consider buying if it were public). BodyCentral is HQ’ed in the Southeast and have no stores yet in the Boston area or San Francisco (the 2 places you will most likely find me) so I haven’t witnessed it personally. But my resident expert (Mrs. G) has told me she likes the styles at BODY so I’m guessing they’ll do well this quarter and maybe some buyers are trying to get ahead of that.
The “bond replacements” were mostly flat, or a bit down, as were the MLP’s; large cap tech was flat to slightly down. US Treasuries and TIPS were a bit up. If the indices overall are slightly up and bonds are too, it tells me that both the recovery and the deflation camps are adding a bit to positions. There is however, one big problem. Volume. I pointed out early last week that it felt like 2007 when the indices crawled up all year but I felt ‘awful” the entire time, like I knew something bad was going to happen. This has sort of that feeling but not quite. The problem now is that every possible argument for direction either way is out in the open. Friday Barry Ritholtz tweeted that a certain negative magazine cover story was the “single most bullish thing” he’s seen this year. So we’re seeing the negative news which is historically a contrarian signal. Then we have the advisors a bit too bullish for other students of the market. The deflationists see deflation – David Rosenberg, whom I enjoy reading, is a big believer in that (he recommends the 2011 portfolio I have mentioned previously – income, income producing equities, and gold). We also have the inflationists like Bill Fleckenstein, whom I enjoy reading, Jim Grant, Fred Hickey and Jim Rogers.
In my opinion, the more nuanced debate is this: Read More→