Wednesday , October 16 2019
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Tag Archives: Market Analysis

Announcement: BullMarkets.co is now a part of SentimenTrader.com

Hi everyone, I’m excited to announce that effective immediately I will join and publish content on SentimenTrader.com. Jason and his team at SentimenTrader approach trading in a similar way as I do: thorough quantitative analysis that uses historical data to guide future trading decisions. I will be publishing my “market stats” and trading models at SentimenTrader.com. The format will be similar to what you’re used to seeing here at BullMarkets.co: Blog posts for market stats...

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What is the wild bond market saying about the stock market?

While the stock market’s decline isn’t extreme by any means, other related markets seem to show heightened fear. The correlation between stocks, bonds, and gold has been strong recently. Risk-on days see stocks & yields go up, while gold falls. Risk-off days see stocks & yields go down, while gold rallies. Today’s headlines: Double volatility spikes Stocks & bonds: part 1 30 year bond yield sinking to a new low Both yield curves Stocks & bonds: part 2 Go here to...

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Market outlook: is this a V-shaped recovery?

The stock market bounced this week after it tanked last week on trade war news. Is the stock market making a V-shaped recovery? Probably not. Technicals (short term, next 1-3 months): mixed. If I had to assign a probability to a V-shaped recovery, it would be < 40% Technicals (medium term, next 6-9 months): mostly bullish Fundamentals (long term): no significant U.S. macro deterioration, but the long term risk:reward doesn’t favor bulls. Technicals: Short Term & Medium...

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August 9, 2019: leading indicators macro update

Instead of trying to predict when the economy will deteriorate in the distant future, we simply look for deterioration among the leading indicators. Instead of predicting the next 10 steps, we seek to predict the next 1-2 steps for the economy. Here’s a brief summary of the leading economic indicators we track Positive factors Labor market Financial conditions Loans Inflation-adjusted new orders Heavy Truck Sales Inflation-adjusted retail sales Neutral Corporate profits Negative...

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Is the stock market making a V-shaped recovery?

The U.S. stock market continues to rally. V-shaped rallies are uncommon, but not impossible. Today’s headlines: V-shaped bounce Volatility is falling % of stocks above their 50 dma is rising AAII sentiment crashed NAAIM sentiment crashed Go here to understand our long term outlook. For reference, here’s the random probability of the U.S. stock market going up on any given day. V-shaped bounce The S&P fell 6 days in a row, and is now up 3 days in a row. When this happened in...

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Market’s flight-to-safety: should you buy stocks now?

The stock market and bond yields recovered today from an early morning decline. Meanwhile, financial markets have exhibited some extreme flight-to-quality over the past few days. Today’s headlines: Lots of gaps Put/Call ratio remains high Flight to quality: part 1 Flight to quality: part 2 Similarities between today and 2016 Bullish Percent falling to a new low Gold spiked (again) Go here to understand our long term outlook. For reference, here’s the random probability of the U.S....

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Was the recent stock market top just another false breakout?

The stock market bounced today, recovering some of yesterday’s losses. From a big picture perspective, the stock has gone nowhere since January 2018. Many traders are once again asking “is the recent breakout just another false breakout”? Today’s headlines: Trendless stock market Down volume Short term breadth recovery Stock market’s risk-off stance Recession probability Go here to understand our long term outlook. For reference, here’s the random probability of the U.S. stock...

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Should you be afraid of the trade-war market selloff?

The stock market tanked today on trade-related news. Some short term bullish signs continue to emerge, but these are not decisive. Among these short term bullish signs are other signs that suggest further short term selling. Overall, there is no clear selling exhaustion. Today’s headlines: Financial markets: risk off Volatility spike Put/Call ratio spike Economic barometer made 2 year low Stocks down for a 6th day Go here to understand our long term outlook. For reference, here’s...

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Market outlook: is the stock market selloff over?

Last week we explained why the market’s short term outlook is bearish. The stock market is now making a pullback, and trade war news isn’t helping bulls. Over the past year, tariff-related news has not been good for stocks in the short term. Technicals (short term, next 1-3 months): mixed Technicals (medium term, next 6-9 months): mostly bullish Fundamentals (long term): no significant U.S. macro deterioration, but the long term risk:reward doesn’t favor bulls. Technicals: Short...

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August 2, 2019: leading indicators macro update

Instead of trying to predict when the economy will deteriorate in the distant future, we simply look for deterioration among the leading indicators. Instead of predicting the next 10 steps, we seek to predict the next 1-2 steps for the economy. Here’s a brief summary of the leading economic indicators we track Positive factors Labor market Financial conditions Loans Inflation-adjusted new orders Heavy Truck Sales Inflation-adjusted retail sales Neutral Corporate profits Negative...

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