“Eventually, Markets Have To Reflect Realistic Assumptions”
On Thursday in “Stop The Madness,” we highlighted some commentary that we think is broadly representative of how investors are thinking about markets these days. In a nutshell, the message is this: there’s so much cash floating around and no one knows where to put it because yields on everything from German bunds to investment…
Critical Levels on the S&P - Doing it Live!
Today's trading day is a great example of having the ability to look over the shoulder of an experienced trader. Let's look at a clip from this morning's room session with Don Kaufman. Then if you'd like to join TheoTrade's live trading chat room here's a special (35% off) one time offer link to use:…
Exposing The Lie Behind “Efficient” Markets
We’ve talked tirelessly about how correlated and interconnected markets have become in the post crisis world. If you believe in the efficient market hypothesis, you believe - generally speaking - that asset prices always reflect available, relevant information. In other words, you can’t “beat the market.” It’s always going to “beat” you to the mark…
A Tale Of Two Manufacturing Prints
So it was more mixed signals about the state of the global economy on Thursday with manufacturing reports out of the UK and the US painting starkly different pictures of economic health. At around 4:30 ET we got the UK print. Here’s the Bloomberg summary: U.K. Aug. Manufacturing PMI 53.3 vs 48.3 in July; Est.…
Markets Ready to Break the Range!
We have been warning TheoTraders about the 2160 level all month. Again we saw heavy volume come in today at that level. To the upside the 2180 level has been the one to watch. I do expect to see us break that range after Friday with the unemployment numbers being the catalyst. The only question…
Follow the Pain on Friday
With unemployment numbers on Friday, ahead of Labor Day, we need to ask ourselves what would generate the greatest pain for the most investors? Because the market always targets that which causes the greatest pain point. Markets move because they have to. Let's look at where the pain points may be...
Stop The Madness
Sometimes really smart people say things that seem really silly in times when rationality has been pushed aside by some powerful force exerting undue pressure on markets. Allow us to give you an example. The following are excerpts from Friday’s commentary by Bloomberg’s Mark Cudmore, a former FX trader who writes a daily missive: “Stop…
Dollar Dilemma Looms As Greenback Hits Three-Week High
“We’re in a world where they seem to work. They may be difficult to deal with for savers, they go along with quite decent equity prices.” That rather disquieting quote is from Fed Vice-Chair Stanley Fischer who was the Fed speaker du jour on Tuesday in yet another week where markets are simply waiting around…
Looking Ahead To Friday: NFP Preview
Citi has some “things” they want you to take note of headed into the Friday jobs number that could ultimately determine “to hike or not to hike” next month. Here are the bullets (these are based on the initial print, i.e. not the revision): In these 19 years the August initial print has been above…
Bonds Rally, Time to Short BAC
While the stock market continues to be stuck in a tight range the bonds exploded higher today. This should be hurting the financial sector yet earlier in the Bank of America (BAC) was up more than 1%. Here's the short BAC trade idea we took today...