Tag Archives: market lab report

Market Lab Report – Premarket Pulse 8/28/15

Major averages rose yesterday on lower volume, closing near the top of their respective trading ranges. Virtually all formerly leading stocks are sitting within broken chart patterns, and over the past two days have merely rallied back up into areas of potential overhead resistance. Thus the long side of this market remains questionable. The US economy grew at a faster 3.7% annual pace in the second quarter, up from the initial estimate of 2.3%. Oil soared 10%, its largest gain since 2009. The Fed may now have more room to hike rates at its next meeting, but the global economy remains in a quagmire with the recent global turmoil in China’s markets, thus the Fed may postpone the hike. Indeed, futures telegraph the probability of a rate hike in September at just 24%, down from 51% a few weeks ago. Expect a continuation of elevated volatility in the near term.

Market Lab Report – Premarket Pulse 8/27/15

Major averages bounced hard yesterday on higher volume after the Monday mini-crash. Don’t let all the headlines make you think today’s market’s gains are anything special. Yes, they are the largest gains in 4 years, but as all our members know, context is key. And after the mini-crash we have witnessed, a bounce of 4%+ is nothing special. That said, with all the money printing going on, markets may decide to catch up to former levels, in which case, a number of up weeks may be in store where the markets make baby-steps back toward old highs. That said, deeper trouble may be brewing. Some analysts including Ray Dalio who is the CEO of Bridgewater think that the Fed is lining up for another round of QE, or QE4. With central banks in full throttle money printing mode, and with the global economy nearing recession, central banks have less and less room to manipulate markets higher, thus should the Fed eventually paint itself into a corner, a loss of confidence in the Fed could spark a far more serious correction down the road. But making predictions of if and when such a crash would occur is futile. As always, with all the market crash talk that has been asked of us these days, we examine markets in real-time, day to day, so that gives us enough to know what to do on the long and/or short side. Keep in mind that no one has ever demonstrated with any consistent reliability the ability to predict the timing or depth of market crashes. The future doesnt exist. At www.virtueofselfishinvesting.com, all we need to know is the now.

Market Lab Report – Premarket Pulse 8/26/15

Major averages gapped higher yesterday morning by nearly 4% but suffered a sharp reversal later in the day to end in the red on lower volume. Futures are up almost 2% at the time of this writing as the Peopleâs Bank of China said it will inject $21.80 billion into the financial system in a new easing effort, following yesterday’s interest-rate cut by its central bank. As we have warned, expect unusually high levels of volatility as witnessed by the routine gap ups and gap downs in this news driven environment. As legendary trader Jesse Livermore once said, huge money is lost trying to trade the market when it should not be traded.