Technical analysis has evolved in many ways since the first time someone decided to plot the movements of stock prices on to graph paper. The logic behind this was to systematically determine the direction of prices over time. The underlying premise of all analysis of course is the notion of trend. Once a ‘trend’ has … Continue reading Determining Market Condition Using Point And Figure
For the other half of market analysis is not just what, but as importantly, it's when.
One of the most common misconceptions about the interpretation of price movements of charts is the expectation that pattern recognition equals precise predictability. While one aspect of using technical analysis is to make sense of price movements, there is no certainty that what has worked in the past will work in exactly the same way … Continue reading It’s What As Well As When
Supply and Demand. The dynamic expressed by this phrase is the cornerstone of Capitalism: In fact, this concept drives most of the things that we experience in life and is not confined just to issues of money. But for our purposes, the supply demand dynamic is played out daily in the public stock markets and … Continue reading Why Rotation?
In the last article, I discussed the likelihood of rotation in the stock markets even as bigger trends continue to advance. While the market leaders in the tech heavy Nasdaq issues held mainly firm, conspicuous strength rotated into a number of other emerging sectors. As discussed last year, the surprising strength of the consumer economy … Continue reading Trends And Rotation
2020 will go down as one of the most volatile trading years in recent history, if not ever. Traders and investors were subjected to a sickening meltdown of financial assets in the early part of the year. The financial world appeared to have had become totally unglued. The breadth of the selling panic in February/March … Continue reading Lessons Of 2020
I've stolen that sentence from Franklin D. Roosevelt to commemorate today's date, October 19th. To those who have been long time participants in the stock markets, that day in 1987 was the single most traumatic experience in their lives, even as ensuing selloffs in the years since have arguably been as dramatic. At that time … Continue reading A Date That Will Live In Infamy
Most of the time, the public is exposed to the statistic of price to measure market activity, whether the indices or their specific holdings. While this can certainly measure current action, it does not reveal any underlying strength or weakness. How can we be sure that price trends will continue? In order to have confidence … Continue reading The Strength Of Breadth
The majority of the public, including some professionals, obsess over the action of the popular averages of the Dow Jones or the S&P in order to gauge market health. It should be clear that these measures are only barometers of stock market activity, they don't provide enough detail to reveal many underlying sectors. After all, … Continue reading Stealth Bull
Classical models of market activity hold that there are predictable cyclic rotations in the equity markets. We are familiar with the overlapping sine waves of market segments as they progress through their stages of growth and decline. In broad brushstrokes, as leading industries such as financials mature, we would expect to see robust economic activity … Continue reading Cycles And Rotation