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The Bear Thread

Discussion in 'Stock Market Today' started by bigbear0083, Apr 1, 2016.

  1. bigbear0083

    bigbear0083 Content Manager
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    Memorial Day Trading: Normally Uninspired on Days Before Long Weekend
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    In the Stock Trader’s Almanac we show how the market trades around Memorial Day. In the table below we went back to 1971, the year the Uniform Monday Holiday Act took effect, moving Memorial Day and most other federal holidays to Monday. In what used to be the “May/June Disaster area” the S&P was down 15 of 20 Mays from 1965 to 1984. Then May was the best month from 1985 to 1997. In recent years, the Friday before Memorial has become getaway day on The Street and volume is often diminished and trading uninspired. With many areas of the country reopening, this trend is likely to continue. Average performance on each of the three trading days prior to the long weekend is rather lackluster for S&P 500 and NASDAQ. NASDAQ does have a higher frequency of gains during the three days, but average performance is still tepid.
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  2. bigbear0083

    bigbear0083 Content Manager
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    Claims Continue to Fall, Continuing Claims Continue to Rise
    Thu, May 21, 2020

    For the seventh week in a row, jobless claims have been falling coming in at 2.438 million which was above forecasts of 2.4 million. This week's 2.438 million number is the lowest claims data point since the first spike in March. That is certainly a positive as those declines are a sign of improvement, but claims also continue to print at much higher levels than anything observed prior to COVID-19 as the running total since the first print over one million in March now stands at 38.6 million. That is roughly 11.8% of the US population or 23.5% of the labor force.

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    As previously mentioned, this was the seventh consecutive week in which jobless claims declined week over week. As shown in the chart below that is an unprecedented streak. In the data going back to the late 1960s, there have only been two other stretches of seven weeks of declines: one ending in October of 1980 and another ending in November of 2013. Given jobless claims are at such extremely high levels and have very far to fall until they return to normal, this streak certainly could keep growing.

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    As for the non-seasonally adjusted data, this was only the sixth consecutive week with a decline, but this week's 2.174 million number, as with the seasonally adjusted number, is also the lowest print since the first of the extreme readings in March.

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    The four week moving average has also continued to decline consistently falling for a fourth straight week down to 3.042 million. While an improvement, this week's decline of 501K was the smallest week over week decline since the four week moving average began to turn around four weeks ago.

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    Again while initial jobless claims have been improving in recent weeks, a massive number of people in the US remain unemployed. Although lagged one week to initial jobless claims, continuing jobless claims came in at a record 25.073 million this week.

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  3. bigbear0083

    bigbear0083 Content Manager
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    Sectors Moving Towards Overbought
    Tue, May 26, 2020

    The S&P 500 has managed to trade in overbought territory for most of the past week. Looking across the eleven major S&P 500 sectors, six are overbought (over 1 standard deviation above its 50-DMA) at the moment while five are neutral (within 1 standard deviation of its 50-DMA). Industrials, a recent laggard, was the best performing sector last week, gaining 7.2%. That rally led the sector to not only take out its 50-DMA but also move into overbought territory. Financials, Real Estate, and Utilities which have also fallen behind performance-wise recently also managed to finish above their moving averages though they have not reached overbought territory just yet. Regardless, conditions across sectors are broadly overbought at the moment if not approaching overbought.

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