Fed Does An Emergency Cut, But Markets Continue To Panic
Yield Curve Just Predicts Fed Action Many of us thought the Fed wouldn’t cut rates until its March 18th meeting. But instead it did an emergency 50 basis point cut on Tuesday. This decision didn’t calm markets. Before we get to what Powell stated and the impact it had on markets, let’s look at what did…
More Selling after Fed Cuts Rates
As Don discussed, the Fed surprised markets (but not TheoTrade!) with an emergency .50 rate cut which predictably sent stocks surging to session highs. But that's not the complete picture. That was the high of day and stocks sold off persistently into the close as Gold rallied to session highs and Treasury yields hit new…
Long Bond Is At An Extreme Level
Buy Everything? Monday’s market was similar to the rally on Friday afternoon. It was a very strong across the board rally. 79% of stocks rose which didn’t meet the threshold set on December 26th, 2018. That's the one in which 96% of stocks rose, but we wouldn’t call Monday’s rally disappointing. Dow rose 5.09% which…
Consumers Aren’t That Worried About The Coronavirus
Consumers Are Still Doing Fine Little evidence exists that the coronavirus is significantly hurting the consumer. There have likely been changes to consumer behavior. Reports are coming in of consumers stocking up on necessities. That could be good for firms like Costco. As a side note, going to a crowded supermarket might not be ideal…
Should You Buy this Dip?
Stocks explode higher today in what's called a rip your face off rally. Is the sell off over? Central bankers from around the world have come in for the rescue. There's now a 100% chance of a 50 basis point rate cut at the March 18th Fed meeting. The 10 year Treasury is on the…
Coronavirus Takes The Market On A Wild Ride
Another Wild Ride Friday was the grand finale of the week and it didn’t disappoint. It was arguably the wildest ride of this correction. There were moments where it looked like stocks bottomed and moments where it looked like we were headed for new lows. It was one of the craziest days we've seen in…
Stocks Realize Painful Reality: 2020 Won’t Have EPS Growth
Stocks Aren’t That Cheap Currently, the stock market’s sharp decline is drawing everyone in. It’s addicting to watch such a vicious decline. Since this was the fastest 10% decline from a peak, we are watching market history. Because stocks have fallen so fast, the natural first inclination is to buy the dip. This isn’t necessarily…
On the Verge of a Bear Market
What a week in the markets! A 7 standard deviation move this week devastates markets, trading firms, premium sellers, and long term investors. What's next after this historic week in the markets? Can the Fed save us or is this start of a much longer bear market? Join Don right now on this crucial weekend…
Thursday Panic Breeds Great Opportunity For The Patient
Correction Becomes True Panic There are quite a few amazing stats on this recent selloff. However, recognize that by the time the impact of the coronavirus is shown in economic data, stocks will likely be done selling off. Traders are always on the leading edge of the facts even though it seems like emotional panic…
Economy “Was” In Fine Shape
Economy Is Doing Well? Bloomberg economic surprise index hit its highest level in 2 years. That’s based on January data which tells us the economy likely would have had a nice rebound in the 1st half of 2020 if it wasn’t for the coronavirus. Even if the coronavirus has a big impact on global growth in…