For the past week US stocks have seen a clear and powerful bounce off support – a nice “Santa rally”. As we are in the holiday season trading is light and moves can be exaggerated. The key will be to watch what happens when traders come back from holiday in January. The recent rally may look […]
Month: December 2015
Stock Valuation = 1929 and 1999
Corporate earnings are in a recession – did stocks miss the memo? Either stocks know something we don’t and are expecting the global economy to suddenly pick up and roar to life, along with earnings, or stocks have entered a new era where value doesn’t matter any more. I deliberately mentioned earnings “recession” in the first sentence to highlight […]
German Stocks – Santa’s Sleigh Hits Turbulence
The DAX has seen a mini Santa rally in the run up to Christmas, however it has come to rest at an area of resistance. Given that we are now in the holiday season trading volume is very low, so it is unlikely we will see any major or clear movement until next year. In […]
Another Commodity Index Breaks
As highlighted in an earlier post commodities have fallen to or below the 2008/2009 Great Recession lows. The decline has been one of the longest in recent history with low prices likely here to stay for some time. Going forward the negative effects of this are and will continue to reverberate across the global economy. Commodities […]
Global Stocks Topping Out?
Many markets around the world have been rolling over in 2015. There are a couple of indices that can give a general snapshot of global stocks. The first one I want to show you is the MSCI All World Index (ACWI) – has a 53% weighting towards the USA. This is a long term snapshot from the Great Financial […]
Oil Plummets and Weakness Will Persist
The overall trend for oil is and remains down. The only positive we can expect is a mild bounce. The trend indicators have been negative since August 2014. Price is currently oversold and resting at support around $35 (the 2009 low). Price may bounce here, but given that the overall picture for oil is very […]
US S&P500 Drops Post Fed Rate Hike
So much for a “Santa rally”. It appears a deteriorating economy and the Fed rate hike is finally hitting home with stock investors. It will be very important to watch the 1960 price line over the coming weeks. Should price penetrate and close below this level it is very bearish. It would send a strong signal that stocks […]
Money Continues to Flow From Stocks to Bonds
Since the summer of this year money has started flowing more into bonds than stocks. This can be viewed a defensive move with investors becoming increasingly nervous over the economy and consequently stocks. As investors lose their risk appetite it is common to see a movement of money from stocks to bonds. Here’s a long […]
Energy Sector Slumps – Tests Summer Lows
Energy and commodities are in pain The energy sector, and commodities, continue to tumble and drag down the stock market. Here’s the latest chart: Head and shoulder and gap fill = price decline on the way I’ve highlighted a head and shoulder pattern that formed following the October rally. This is a bearish pattern that was confirmed […]
German equities rally – Santa’s here! But, for how long?
Santa Rally Yesterday’s price action was very strong with the DAX up nearly 3 and a half percent by mid-day. To put that in perspective I looked at how many times the DAX has actually managed to finish up 3% in a day. The answer is six out of 750 trading days. In contrast, oil […]