It’s What As Well As 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

Why Rotation?

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?

Trends And 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

A Date That Will Live In Infamy

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

Cycles And Rotation

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

The Significance Of Ranges

Experienced market participants know that stocks spend most of their time in seemingly random ranges.  It is only for a short time that they will actively trend up or break down.  This is logical since companies will go about their business in a somewhat predictable and systematic way. When something unusual or extraordinary happens, or … Continue reading The Significance Of Ranges