.png){kind=small}
Posts
.png)
.png)
The "fat pitch" that was looking good has fizzled into a stinky, foul ball. In all likelihood, we are looking at a bear market.
Wednesday, June 30, 2010
Morning News Notes: 6/30/2010
The "Morning News Notes" as prepared by TL...S&P/ Case - Shiller 20 City Composite Index, leading indicator in China, financial reform, ECB 3 month tender, European bank stress tests, and double dip debate.
Monday, June 28, 2010
Investor Sentiment: The Story Continues
When we last looked at investor sentiment, I had noted that bearish sentiment (i.e., bull signal) had given way to a more neutral reading. In essence, equities would need to rise on their own merit, and with the fundamental storm clouds gathering - i.e., talk of a double dip recession is escalating -it is not clear to me what the drivers for higher prices will be. Nonetheless, the market's inability to stage a rally at this juncture here is important as failed signals carry significance. The current signal has not failed yet, but I have defined what a failed signal would look like. Last week's price action, which appears to be consistent with the fundamental picture, tested that failure point.
Morning News Notes: 6/28/2010
The "Morning News Notes" as prepared by TL...Senator Byrd dies, financial reform, Gallup Poll on President Obama's decision to remove General McChrystal, G20, new mortgage rules, corporate cash levels at near record levels, and Fed money printing and M2 money supply.
Thursday, June 24, 2010
Bonds Look Attractive
There are two trades in this market: the risk trade and the non-risk trade. The risk trade is in equities and all the other assets, like commodities, real estate and emerging markets, that have become highly correlated to equities. The non-risk trade is in bonds. This works when equities don't. With the bounce in equities sputtering (but not having rolled over yet), Treasury bonds are looking attractive.
Morning News Notes: 6/24/2010
The "Morning News Notes" as prepared by TL...initial jobless claims, new single family homes, General Petraeus, and Germany.
Wednesday, June 23, 2010
Re- Defining Our Stops
For several weeks now, I have argued that extremes in bearish sentiment are a "fat pitch". Why? Because market gains can be rather dynamic if the market reverses. The other factor that has made this a "fat pitch" environment has been the ability to define our risk. If the market did not reverse higher while investor sentiment was bearish (i.e., bull signal), then it was likely meaningful suggesting significant down side risk.
Subscribe to:
Posts (Atom)
.png){kind=small}
.png)