Morgan Stanley Predicts 30% Rise In S&P 500
On Monday, Tesla passed General Motors in terms of market cap, making it the highest valued automaker. This article isn’t about Tesla, but Tesla serves as a red flag for how out of whack valuations have become. Tesla isn’t even the leader in electric vehicles sales which is its niche. The firm lost $675 million…
Sub 1% Q1 GDP Growth?
The latest statement by Paul Ryan, the Speaker of the House, was that tax reform could take longer to get done than healthcare reform. That’s an interesting way of putting it since healthcare reform still hasn’t gotten done. The first step of healthcare reform, which is voting on it in the House, wasn’t even completed.…
Is a Sell-Off Going to Happen?
In a 12 hour span the markets saw missiles fly into Syria and a weak jobs report that missed expectations. And yet the markets ended the day unchanged. In this critical weekend update there is a lot to look at. The inverted volatility futures, the bond market, and the elevated expected move are all screaming…
Dumb Money Bulls Vs. Smart Money Bears
In this article, I will discuss how the dumb money is driving the stock market higher. When reviewing the behavior of dumb money investors, human psychology comes into play. The reason psychology is more important in describing the behavior of dumb money investors than smart money investors is because professional investors are aware of the…
What The Fed Means When It Says Stocks Are Expensive
As I mentioned, the Fed said in its Minutes that valuations were ‘quite high.’ CNBC decided to do an analysis of how stocks performed one year after the Fed has said stocks were expensive because the Fed rarely comments on valuations. As you can see in the chart below, the Fed has commented on how…
No Follow - Through to Key Reversal Bar - Jobs Report?
Stocks rallied slightly higher today after the sell off into the close yesterday. The lack of follow through to yesterday's reversal is not concerning. In tonight's video we will look at the current short term down trend in the S&P and what to look for going forward. Tomorrow's job report could be just what the…
Fed Discusses Balance Sheet Reduction In Minutes
In the last Q&A Yellen did, she mentioned that the FOMC members didn’t want to consider the unwinding of the Fed’s balance sheet to be a part of the hawkish policy of rate hikes because the Fed had no experience with unwinding its balance sheet. She said communicating policy on the unwind of the balance…
Blowout ADP Report
In this article, I will review the latest economic reports and review some data on buybacks. The ADP private sector payrolls report came in better than expected, but there was a large negative revision in the February report. The ISM non-manufacturing report missed expectations. This could be sign the strong survey data trend is starting…
The Volatility Beast has Awoken
Stocks took off higher this morning on a positive ADP report and then gave it all back and then some in the last 2 hours of the trading day. The market that we have been watching the last few days has been the volatility market which is showing major signs of risk on the table.…
Don’t Fight The Fed
The stock market continued its trend of not doing much on Tuesday as the S&P 500 eked out a 0.06% gain. The main political story in the news is the Senate’s vote on whether to approve Judge Gorsuch’s nomination to the Supreme Court, so there’s not much market moving stories coming out of Washington D.C.…