frankz

Today's breakaway gap to the downside will more than likely be the talk of the town as the week progresses.  If you remember, the first trading day of 2013 the SP500 gapped up 1.89% and never looked back, that gap is still unfilled.  Many might assume that today's breakaway gap down might have the same effect as the 2013 gap up, but obviously in the opposite direction. Regardless if that is the case or not, I believe that today's gap will be very significant going forward and will more than likely act as stiff resistance in the days and weeks [...]

The SPY (SP500 ETF) started the year down 1.70%, and it immediately triggered its first oversold reading of the year.  As you can see in the chart below the average amount of SP500 stocks above their 3,5, and 10-day moving average is at a level that has historically produced bounces. These bounces have allowed opportunistic traders an opportunity to make some money on the long side and have given others better prices to sell into days later.Welcome to 2016 and our first oversold reading of the year. We will all be watching to see if this oversold reading acts the [...]

Based on the market action of the last year, most investors probably would've been better off doing nothing.  Bull and bear markets are generally defined by whether or not the SP500 is trading above or below its 200-day moving average.  Over the last year, the SP500 has vacillated above and below the average for short periods without a sustained trend.While the SP500 has held up relatively well due to a few mega-cap names holding up the index, the majority of stocks have been in a bear market for most of the year.By comparing the SP500 and Nasdaq 100 to their equal [...]

Read This Before You Call It Quits25 Years Later We Are Still Complaining About The Same ThingsWork With MeStay Informed

Before you jump the gun and call it quits on the market based on a tough week I want you to know a few things;1.  Since 1980 the average intra-year decline in the SP500 has been roughly 14%.  26 out those 34 years despite the average intra-year drop the market closed positive, 76% of the time.  That does not mean that the declines were not painful; it's just a reminder that the market goes UP and DOWN, not up OR down.  And, draw-downs are unavoidable, there is no sense in trying to avoid what cannot be avoided.  2.  Its never [...]

25 plus years later we are still complaining about the same things.  The more things change, the more they stay the same.  If you have kept an eye on the financial blogosphere you have probably read about; the massive buybacks corporations are doing due to all the free money, the underperformance of hedge funds, and the influx of cash moving into passive strategies. Below are excerpts from a book written 25 years ago."The rotund and owlish seventy-five-year-old money manager's worries are legion: the horrendous budget deficit, the competitive failings of U.S. business, deficient ethics, the undisciplined stock-buying spree."--Every time a [...]

The above quote from Sean McLauglin is very true, all you have to do is read any of the market wizards books to agree.  You had macro investors, value investors, technical traders, etc..; Bruce Kovner, Jim Rogers, Mark Weinstein. Today we have many extremists in the investing world; we have the extreme fundamentalist, the extreme technician, the extreme passive investor and the extreme active investor.  What dictates what is the right way or wrong way of investing/trading is your P&L.  I believe a hybrid approach triumphs all.There is no doubt that in order for a stock to make a multi-year [...]

You can control what stock to buy.You can control how much money you put behind the idea.You can control which markets you trade in.You can control how much you are willing to risk per trade. You can control what type of stocks you buy, big caps, only small caps, only over $20, only under $10, etc.,You can control what kind of set ups you buy.You can control when you get in or out, barring a halt.You can control when to trade or when not to trade.You can’t control the outcome of the trade.You can’t control how the market will react to [...]

Right around 3:40 pm news hit the wires that Brazil's President Dilma Rousseff will face impeachment proceedings. EWZ (Brazil Index Fund) spiked higher.  One can assume that based on the immediate reaction that the investment world views the news has positive.The news comes at an interesting time, there has been some recent heavy call buying in EWZ, and the ETF has held above the low of 9/10/15 which was the day after Standard & Poors downgraded Brazil to junk.But it gets better.  December by far has been the best month to own Brazil.  In the last 15 years EWZ in December [...]

I'm a big fan of bases, the longer the base the better.  The base is a term that technical analysts uses to define a stock that has been trading sideways for a while.  I'm always intrigued by bases because a prolonged period of contraction typically leads to an extended period of expansion, and the longer the base, the better it is.  What happens in the base that is being formed after a big decline in the stock is that the buyers and sellers find equilibrium, the sellers, for the most part, are done selling and or the buyers are taking [...]