frankz

The investment community was blessed this week with the opportunity to hear legendary investor Stanley Druckenmiller share some of his thoughts about investing.  Stanley is mostly known for the $1 billion dollars he made for George Soros betting against the British Pound in 1992.  From 1986 to about 2007 his fund had averaged 30 percent annually.  In 2010, he decided to give back outside money due to his frustration to produce the returns he was accustomed to. He was managing too much money, and that made it extremely hard to produce significant returns.Stanley sat down for an interview with Andrew [...]

There as been a lot of comparison of the recent market trajectory to the one of 2011.  I have made that comparison numerous times here in these pages.  As a matter of fact, the correlation of the 2011 sell off, and the current one stood at 90% on September 22 and it is still very high today, you can see that in the chart below.While on the surface they look similar, acted almost exactly the same, at times to the day, underneath the surface they couldn't have been any different.  In 2011 when the market rallied in October the rally was [...]

The last two months have been a roller-coaster ride.  It all started with the August plunge that panicked many investors. September began with a 5% rally that alleviated some of the pain for many. However, we ended closing at the August lows by the end of the month exactly when we got the Carl Icahn Danger Ahead Video.  October started with a bang; a non-stop grind up that got back all the losses from August, it was like August never happened, a bad dream, a blur.Here are few lessons from this recent action;The market goes up and down not up [...]

There's been some complaining recently about the breadth of the market.  Quite simply it's been horrible, I saw one tweet that said "I have no idea what is holding up this market". Big caps have been holding up this market.Based on my stats, breadth peaked on 10/12/2015 which is precisely when the Russell 2000 peaked. Since then the Russell 2000 is slightly negative while the Dow 30, QQQ 100, and the SP500 are positive.Nine out the last 12 days we have seen more stocks down 4% or more for the day than stocks up 4% or more for the day. [...]

This market continues to play out almost exactly like the 2011 sell off.  Believe me, every year is different, and history doesn't repeat itself, but it rhymes.  We mentioned the similarities to 2011 here, here and here.In October of 2011, the SP500 had a massive rally off the lows, and that briefly got it above the year to date breakeven level and above the 200-day moving average, this is exactly what just happened in the SP500 almost exact to the day.SP500 2011Here is where it gets interesting; "… the SPY's 2015 price action continues to follow the pattern of 2011, even down to how it [...]

The market works in a masterful way, and sometimes it lulls you to sleep and then pulls off the covers, and then it scares the living Jesus out of you just to tell you it was only pretending.  By 7/30/15 the market had been going sideways for seven months, the breadth was deteriorating but the SP500 was holding up well.  There were a plethora of blogs stating that the deterioration of breadth was irrelevant; we challenged that thinking with this post; The Market Dilemma That Is Driving Everyone Nuts. After that, the market sold off hard, by 8/24/2015 many were saying that we [...]

I'm not overly excited about the current risk reward ratio for new longs at this juncture.  We have rallied significantly from oversold levels to a mountain of supply.  Whether or not the overhead supply will be an issue remains to be seen. I'm also seeing a bunch of companies miss their numbers, however for the most part their stocks have reacted well after the miss; INTC, GS, GE, JPM, to name a few.Narrow Focused BounceOverhead SupplyOptions Expiration OverhangResistance Levels Worth WatchingWork With MeStay Informed

There has been a lot of talk lately on the twitter stream about the market rallying into options expiration and then giving up all the gains.  There is some truth to that, and the fact that we are at or near resistance levels (read) one should be aware of what has happened after options expiration.Underneath what you are looking at is the SPY starting the Monday after options expiration through the next ten days.  Every month has shown some weakness after expiration and the context of every month has been the same, a rally up to expiration. August was the only month [...]

The market has had a helluva run so far in October.  The SP500 is up 5.8% for the month and seems like an eternity ago when we were warned by billionaire Carl Icahn.  However, resistance lies ahead. The SP500 faces a significant amount of possible overhead supply that starts at 2040 level; the same can be said for the Nasdaq.  The Russell 2000 has been the weakest so far with a series of lower highs and lower lows though there is the potential of the most recent low holding. Quite frankly, I don't see many proper set-ups, and we are [...]

Right around this time you probably just reviewed your monthly statement, you are sitting there scratching your head saying; what the hell just happened.  A lot of things that did not matter over the last year suddenly mattered.  The Wall Street saying–”they take the stairs up and the elevator down” hits home right about now. What took months to make disappeared in days. On top of it all you probably panicked and sold at the wrong time in fear of another 2008 debacle that interwebs sold you on.I’ve been in the financial industry for 18 years, seen a few cycles, [...]