Welcome Stockaholics to the trading week of February 13th! This past week saw the following moves in the S&P: Major Indices End of Week: N/A. Bird's Eye view of the Major Futures Markets on Friday: Economic Calendar for the Week Ahead: Sector Performance WTD, MTD, YTD: What to Watch in the Week Ahead: Monday Earnings: Teva Pharmaceutical, Noble Energy, Restaurant Brands International, Vornado Realty, First Data, HCP, Flowers Foods Tuesday Earnings: AIG, Credit Suisse, Dr. Pepper Snapple, T-Mobile US, Discovery Communications, TransUnion, Devon Energy, Express Scripts, Lending Club, Generac, Molson Coors Brewing 6:00 a.m. NFIB survey 8:30 a.m. PPI 8:50 a.m. Richmond Fed President Jeffrey Lacker on economy 10:00 a.m. Fed Chair Janet Yellen before Senate Banking Committee 1:00 p.m. Dallas Fed President Rob Kaplan 1:15 p.m. Atlanta Fed President Dennis Lockhart on crisis, recession, recovery Wednesday Earnings: PepsiCo, Applied Materials, Cisco, Kraft Heinz, Groupon, Marriott, Marathon Oil, CBS, Och-Ziff, Chemours, NetApp, Avis Budget, Kinross Gold 8:30 a.m. Retail sales 8:30 a.m. CPI 8:30 a.m. Empire State manufacturing 9:15 a.m. Industrial production 10:00 a.m. Fed Chair Yellen testifies before House Financial Services Committee on economy 10:00 a.m. Business inventories 10:00 a.m. NAHB survey 12:45 p.m. Philadelphia Fed President Patrick Harker on economy 4:00 p.m. TIC data Thursday Earnings: TransCanada, Wendy's, Time Inc, Avon, Alexion, GNC, Dean Foods, Cabela's, MGM Growth, PG&E, Con Ed, WebMD, Encana 8:30 a.m. Jobless claims 8:30 a.m. Housing starts 8:30 a.m. Building permits 8:30 a.m. Philadelphia Fed survey Friday Earnings: Campbell Soup, Fluor, Bloomin' Brands, Deere, JM Smucker, Moody's, VF Corp, Allianz
Dead Market Ramping - Stocks Hit Record Highs As Activity Hits Record Low Herd mentality..." yes, we are all individuals... he's not the messiah, he's a very naughty boy" Dead Market Walking Lowest 90-day realized vol for the S&P 500 in 10 years... 85 days in a row without a 1% drop... 44 days without a 1% close to close gain or loss... 39 days in a row without a 1% intraday swing... But The Biggest Short Squeeze since the election... Has sent stocks to record highs... Trannies were best on the week, but the massve squeeze lifted everything... On an ever-decreasing bed of lower volumes... VIX was crushed back to a 10 handle leading the Dow to just shy of 20,300... Energy stocks ended the week red but today's kneejerk higher on Tarullo's resignation headlines kept the banks in the green... Bonds traded in a very narrow range today and ended the week lower in yield across the curve... (30Y ended the week back above 3.00%) The yield curve flattened notably... (the week saw the biggest weekly flattening in 2 months) Which explains why banks shot higher today... oh wait... The USD Index has its first positive week of the year (best week in 2 months) EUR was the weakest of the majors on the week and Cable strongest... Meanwhile oil prices ramped into the green for the week (as EIA OPEC data trumped dismal production and inventory data)... And Oil Vol collapsed to 3 year lows... On the week oil ended unchanged. Notably Copper and silver surged today as the USD dropped around the US open (performance post-payrolls) For 2017, The Dow just edge out the long bond but Gold remains the big winner... (6th winning week of the last 7)
Spoiler: Weekend Reading: Fed Up Submitted by Lance Roberts via RealInvestmentAdvice.com, As discussed yesterday, the markets have been quiet. Too quiet. That makes me worry as generally when volatility resurfaces it has not been kind to investors in the short-term. But despite the lack of volatility in the market, the S&P eclipsed 2300 yesterday breaking through the psychological barrier on its continued quest towards 2400. While the market continues to trade on the back of Trump announcements of potential tax reform and support for airlines, the economic backdrop continues to show signs of age. The important point to note here is the historical deviation between exuberance and economic realities has generally NOT been resolved by reality catching up with fantasy. It has always been the other way around. This brings me to my interview with Danielle DiMartino-Booth this past week. She and I dig into the economy, the Fed’s missteps, and the realities that currently prevail in the market and the economy. I am sure you will enjoy the interview. (Note: If you order a copy of Fed Up and bring it to the 2017 Economic & Investment Summit on April 1st in Houston, Texas you can have Danielle personally autograph for you. Also presenting Greg Morris, Michael Lebowitz, and Dave Collum.) In the meantime, here is what I am reading this weekend as I put my “S&P 2300” hat on…for now. Trump/Economy Slapped In The Face by Danielle DiMartino-Booth via Money Strong US-China Relations Speed Towards Rupture by Jim Rickards via The Daily Reckoning Fink: U.S. Facing Two Major Crises by Bob Bryan via Business Insider Optimistic Growth Forecasts Miss The Risk by Ashoka Mody via Project Syndicate Poll: Americans Having Doubts On Trump Agendaby Eric Pianin via Fiscal Times Trump May Send More Jobs To Mexico by Rob Garver via Fiscal Times Happiness Runs by Bill Gross via Janus Capital Trump Right About Need For Term Limits by Caroline Baum via MarketWatch Not A Nation In Crisis by Kevin Williamson via National Review Corporate Execs Play Politics At Their Peril by IBD Trump Rule Fix Means More Money For Street by Benjamin Edwards via Washington Post Trump Kills DOL Rule by David Bahnsen via Forbes Trumps Move To Roll Back Regulation A Mistake by Pedro Da Costa via BI Global Economy’s Surprising Resilience by Jim O’Neill via Project Syndicate Protectionism Won’t Help The Middle by Larry Summers via Financial Times Markets/Fed Be Very Afraid Of The Stock Market by Linette Lopez via BI Really Difficult To Be A Bear These Days by Avi Gilburt via MarketWatch Markets Are Priced For Poor Returns by Jeff Erber via Grey Owl Capital Mgmt. Stock Market Sending Unusual Warning by Anthony Mirhaydari via Fiscal Times Why You Should Never Buy Stocks Again by Ryan Vlastelica via MarketWatch A Valentine’s Day Massacre? by The Heisenberg via Seeking Alpha Seth Klarman Weighs In On Trump by Andrew Ross-Sorkin via NY Times Stocks, Vice & Trump by James Mackintosh via WSJ Growth Stocks & Bond Yields by Eric Bush via GaveKal Fed Already Has A Problem by Pedro Da Costa via BI Is The Trump Rally Over Already by Edward Harrison via Credit Writedowns Investors Should Prepare For Bear Market by Ben Carlson via Bloomberg You Will Need More Than You Think by Robert Powell via USA Today Favorite / Interesting Reads Robots Coming For Wall Street Jobs by John Byrne via NY Post Why The Market Isn’t Freaking Out Over Trump by Tyler Cowen via Bloomberg Trump Not The Only One Working Longer by Justin Fox via Bloomberg Hedge Funds Tracking Every Move by Rachael Levy via BI Retirement: $350k For Healthcare? by Robert Powell via MarketWatch I Am Long Stupidity by EconMatters Yardeni’s Magical Stock Market Indicator by Kevin Muir via The Macro Tourist Quick Guide To Border Tax Adjustments by William Gale via RCM 4% Growth Or Crash by Marc Joffe via The Fiscal Times Biggest Tax Mistakes Retirees Make by Maurie Backman via USA Today Economic Theory Rarely Survives Contact by Joe Calhoun via Alhambra Partners Lacy Hunt: Why Bond Yields Are Going Lower by Tyler Durden via ZeroHedge Texas Realtors Paying For Bad Research by Aaron Layman via AaronLayman.com Investors Rarely See Manias In Progress by John Hussman via Hussman Funds Trump Rally Is Thinning by Dana Lyons via Tumblr 3-Popular Idiotic Investment Strategies by Jesse Felder via The Felder Report “The only thing standing between you and your goal is the Bulls*** story you keep telling yourself as to why you can’t achieve it.” -The Wolf Of Wall Street
Here's how the major indices have fared WTD, MTD, QTD & YTD thus far in 2017: S&P sectors for the week:
February Expiration Week: S&P 500 Up 9 of Last 11 The first day of S&P 500 February expiration week has been up in six of the last seven years. This is a respectable streak, but still short of the 12-year winning streak that lasted from 1994 to 2005. Nonetheless, the first trading day of option expiration week is clearly bullish with S&P 500 up 19 of the last 22 years. Absent the frequently bearish day after Presidents’ Day influence, this has a fair chance of continuing. Expiration day has been down more often than not over the past 23 years with an average loss of 0.28% for S&P 500. Despite a bumpy finish, expiration week as a whole has fared better, but nets an average gain of a paltry 0.17% on the S&P 500 since 1994 with 14 of 23 winning weeks. The week after, has been down 13 of the last 23 years. DJIA and NASDAQ have similar patterns over the same timeframe. First 100 Days Update: Tracking Past Republican Administrations Including today, the market has completed thirteen trading days since President Trump was inaugurated into office. As of today S&P 500 has climbed a modest 1.03% since its close on Inauguration Day. This performance is slightly better than the 0.64% average gain of past newly elected Republican Presidents, but lags that of past Democrats by about 2.4%. Historically, it has been around this part of February when the S&P 500 retreated. A repeat of this pattern is not out of the questions given February’s poor performance in past post-election years and the S&P 500’s recent struggles with 2300. Mid-February Historically Stronger than Beginning or Ending Over the most recent 21-year time period, February has exhibited a tendency to begin with gains on its first trading and then drift sideways to lower until about the seventh trading day of the month. At which point, DJIA, S&P 500, NASDAQ, Russell 1000 and 2000 have typically rallied until the eleventh or twelfth trading day of February. From here to the end of the month, all five indices then headed lower. On average only DJIA and Russell 2000 finish the month with a gain. S&P 500, NASDAQ and Russell 1000 finish in the red.
Another Look At The January Barometer Posted by lplresearch In our latest Weekly Market Commentary, we noted: Taking one last look at January, what happened was both rare and potentially very bullish. The S&P 500 was positive year to date each day of the month and did not close down more than 1% on any individual day. Since 1950*, that has happened only six other times; the results the next 11 months have been very strong, with the S&P 500 rising the rest of the year all six times with a median return of more than 10%. We do expect more volatility, but the data suggest that equity weakness should be considered as a potential buying opportunity. So the question now is: does a good start to the year mean the next 11 months could be strong? As we noted on the blog two weeks ago, when the S&P 500 has been higher in January, then the next 11 months have been higher 88% of the time. This is known as the January Barometer, and it has had a very solid track record when January has been green. Today, we’ll take a slightly different look at this indicator. As noted in the italicized paragraph above, the full month of January 2017 didn’t have a single 1% close lower, and not one day was negative on a year-to-date basis. It also finished the month positive. When those criteria have been met, the rest of the year (so the next 11 months) was higher all six times and saw an average return of more than 15%, with nearly an 11% median return. In other words, the great start to equities this year could be a sign of future strength. Per Ryan Detrick, Senior Market Strategist, “They say it isn’t where you start, but where you finish. That’s very true, but stock market history would say if you start off with an exceptionally solid January (like we saw in 2017), that could improve the odds that you might finish strong.” Emerging Markets Breakout? Feb 10, 2017 After experiencing a big drop in the immediate aftermath of Trump’s victory last November, the iShares MSCI Emerging Markets ETF (EEM) has rallied from $34 up to $38+ over the last couple of months. Today the ETF is trading just 10 cents away from a new 52-week high, which is at $38.32. As shown in the chart below, from a one-year perspective, EEM looks like it has nice breakout potential. While the one-year chart looks bullish, the long-term chart for EEM going back to 2003 looks much less enticing. As shown below, the ETF — which is a way for US investors to gain exposure to the emerging markets asset class — has been making a series of lower highs for the last ten years now. To get above the top of the downtrend line that has formed, EEM needs to move into the mid-$40s, which is 20% higher from current levels. Earnings Beat Rate Finishing Strong Feb 10, 2017 While guidance keeps getting worse and worse as earnings season progresses, the backward-looking earnings and revenue beat rates continue to come in strong. So far this earnings season, 65% of companies that have reported have beaten consensus analyst earnings per share estimates. As shown in the first chart below, 65% would be the strongest reading seen since Q3 2010 if it holds through the end of earnings season on February 21st (2/21 is when Wal-Mart reports — WMT marks the unofficial end to earnings season). For top-line revenues, 57% of companies have beaten estimates this season. While not as strong as the bottom-line EPS beat rate, a revenue beat rate of 57% would be good enough for the strongest reading since Q4 2014. Guidance Gets Worse and Worse Feb 10, 2017 Early on this earnings season, companies were raising guidance at a higher rate than they were lowering guidance. But over the last two weeks, guidance has gotten worse and worse, and at this point the number of companies that have lowered guidance far exceeds the number of companies that have raised guidance. Below is a look at the quarterly spread between the percentage of companies raising guidance minus lowering guidance going back to 2001. As shown, the current reading of -3.1 percentage points would be the weakest seen in a year. Individual Investors Slightly Less Depressed Feb 9, 2017 After dropping below a third in the last two weeks, bullish sentiment on the part of individual investors saw a modest rebound this week, rising from 32.8% up to 35.8%, which is still an extraordinarily low level given where the market is. This week’s level also marks the 110th straight week where bulls have not been in the majority. While bullish sentiment saw just a modest rebound, bearish sentiment saw a pretty sizable drop, falling from 34.17% down to 27.65%. That’s the largest one-week decline in bearish sentiment since early October. With Trump’s agenda seemingly hitting a speed bump in recent days as tax reform appears to be getting pushed further and further back, a plurality of investors couldn’t make up their minds. Neutral sentiment jumped to 36.54% this week, which is the highest level since the election.
Here are where the major indices stand since the Nov. 8th Presidential Election and Inauguration Day as of market close 2/10/17-
Here are the most anticipated ERs for this upcoming week ahead (I'll also have the earnings chart posted in here as well once it's ready) ***Check mark next to the stock symbols denotes confirmed earnings release date & time*** Monday 2.13.17 Before Market Open: Spoiler: CLICK HERE TO VIEW MONDAY'S AM EARNINGS TIMES & ESTIMATES! Monday 2.13.17 After Market Close: Spoiler: CLICK HERE TO VIEW MONDAY'S PM EARNINGS TIMES & ESTIMATES! Tuesday 2.14.17 Before Market Open: Spoiler: CLICK HERE TO VIEW TUESDAY'S AM EARNINGS TIMES & ESTIMATES! Tuesday 2.14.17 After Market Close: Spoiler: CLICK HERE TO VIEW TUESDAY'S PM EARNINGS TIMES & ESTIMATES! Wednesday 2.15.17 Before Market Open: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S AM EARNINGS TIMES & ESTIMATES! Wednesday 2.15.17 After Market Close: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S PM EARNINGS TIMES & ESTIMATES! Thursday 2.16.17 Before Market Open: Spoiler: CLICK HERE TO VIEW THURSDAY'S AM EARNINGS TIMES & ESTIMATES! Thursday 2.16.17 After Market Close: Spoiler: CLICK HERE TO VIEW THURSDAY'S PM EARNINGS TIMES & ESTIMATES! Friday 2.17.17 Before Market Open: Spoiler: CLICK HERE TO VIEW FRIDAY'S AM EARNINGS TIMES & ESTIMATES! Friday 2.17.17 After Market Close: NONE.
ShadowTrader Video Weekly 2.12.17 - The signal that kicked off the rally Video from ShadowTrader Peter Reznicek
Stockaholics come join us in our weekly market poll and vote where you think the markets will end this upcoming week ahead!- Weekly SPX Poll - Sentiment (2/13-2/17) <-- click there to cast your vote for this week! In addition we have our weekly stock picking challenge now up and running as well!- Stockaholics Weekly Stock Picking Contest for the Week of (2/13-2/17) <-- click there to post your picks for this week! We also now have a daily stock picking & market direction guessing challenge running here!- Stockaholics Daily Stock Pick Challenge & SPX Sentiment Poll for Monday (2/13) <-- click there to cast your vote & post your pick for Monday! It would be pretty awesome to see some of you join us and participate on these. Hope you all have a fantastic weekend!
And as promised here are some of EW's most anticipated ERs due out for this upcoming week ahead: ($TEVA $GRPN $TMUS $AMAT $CSCO $PEP $TSEM $ON $MGM $FDC $SHOP $ABX $INCY $QSR $MRO $LNCE $WEX $DCIX $TAP)
Hey all, I'm back from vacation (Been back for a week almost, but not really back. House was burglarized while gone on vacation, had to cut vacation short and have been working with insurance to get reimbursed since I've been home. Ugh. Long story that doesn't need to be discussed here.) Anyway, I have 3 charts I want to share, all of the /ES to give my impression of what's happening and what is going to happen. First chart is 20 year monthly chart. As you can see on this chart, that spotted yellow line is a pretty solid monthly trend line going back a very long ways. We are now trading over that trend line. If we zoom in we see a daily trend line going back a year. We are now at the top of that daily trend line. This is an hourly trend line showing us go over the daily trend line and failing and coming right back down again. Here is my observation based on these charts. If you look at the monthly going back 20 years, you don't usually get more than 6 or 7 months of upwards movement. That's a lot of bullish activity, for sure! But you get a monthly breather after that long. February will be 4 straight up months. It's not impossible for to think, on the hourly chart, that we'll stick around the upwards trend line for some time. But I doubt we'll bust high above it and keep going for any length of time. My theory is that we'll correct now. We may have a burst to the upside to get rid of some shorts, but for the most part, I think the up trend, if it continues, will follow that trend line. I'm going short now and will be leery of doing any short term long /ES trades. Maybe looking for a bounce if we get back down by the yellow dotted line. But otherwise, I'm short. I realize we can keep going up for some time. However, considering the political climate we now find ourselves in (I'm outrageously outraged at everything!) and considering the media is very anti Trump, I fully expect a large correction during this 4 year term. Therefore, I'll be building a long term short position, plus doing a lot of short term trading to the downside (And occasionally some upside for bounces if I'm brave enough). But overall, I'm bearish on the markets right now and will try and position myself to profit from a bearish move over the next year or two.
dang @Baggi that sux man i'm sorry to hear it ... glad to hear you're okay though and still able to login and all ... nice post btw and w/b! really good to see you back.
Good Monday morning Stockaholics! Hope you all had a nice relaxing weekend in here and are ready for a new week, fresh start. Here are your pre-market stock movers & market news on this first trading day of the new week- 2/13 Monday Market Movers & News: AAPL, DD, TEVA, FDC, HAS, JCP, DIS, SHLD, VZ, M, AMZN, TSLA, IBM <-- click there to view! Happy trading week to all of you in here this week. Hope you all make some good $$$ this week!
Interestingly the VIX is up on an up day. Trump promised a tax cut announcement coming in a few weeks, looks like this market wants to continue to go higher until the announcement comes at least
The Trump rally continues. I remember the saying, the market can continue to go up for longer than you can remain solvent.
