September 25, 2022

The primary advantage of the OWL approach is that it seeks to decipher the market’s message through the interpretation of individual stock set-ups. Since it is stocks that underlie the indexes, it is they who offer the first clues. Mythical concepts about how many percentage points the indexes have to be up on how many days after a near-term low before one can call a market turn,... Read More

September 21, 2022

They call him Flipper, Flipper, faster than lightning, No-one you see, is smarter than he, And we know Flipper, lives in a world full of wonder, Flying there-under, under the sea!   – The Flipper TV Show Theme Song, circa 1964-1967. A 75-basis point rate hike from the Fed gave the market just what it wanted, although it took some time... Read More

September 18, 2022

A one-day pause on Wednesday following Tuesday’s brutal post-CPI sell-off looked like it might last at least a little bit longer as market pundits and talking heads anticipated an imminent crash. What the crowd is absolutely certain is about to happen generally doesn’t happen right away, if at all. However, I don’t necessarily get carried away with this since at certain points in an extended... Read More

September 14, 2022

An impetuous four-day rally off the lows of last Wednesday ran into a solid brick wall yesterday when the Consumer Price Index foiled any ideas of a downside surprise with an upside surprise instead. Talk about bait and switch. Core CPI came in at 0.6% vs. expectations of 0.3%, while non-core CPI, which includes gas prices, came in flat vs. expectations of a -0.1% decline. If... Read More

September 11, 2022

The first book I wrote on short-selling, a book titled, How to Make Money Selling Stocks Short (John Wiley & Sons, 2004) that I ghost-wrote for Bill O’Neil, talked about the three-day rule. That is the basic idea that the market will have normal reaction bounces of as much as three days within an overall downtrend at which point you could revisit and re-enter short-sale target... Read More

September 7, 2022

Seven days straight down for the NASDAQ Composite gave things a bit of a porcine odor by late yesterday and early this morning. That led to a logical oversold reaction rally today. Short-sellers who have been riding the bear wave since the S&P 500 reversed at its 200-day moving average over three weeks ago certainly had to have been feeling quite piggy by yesterday’s close. Since the... Read More

September 4, 2022

Five straight down days since Fed Chairman Jerome Powell spoke at the Jackson Hole Economic Symposium two Fridays ago finally reached official Piggy levels by Thursday morning, triggering an oversold bounce off the intraday lows. Generally, one can get a sense of this by just how fat and happy one starts to feel playing the short side as most short-sale targets were streaking lower Thursday... Read More

August 31, 2022

The major market indexes, the Dow, NASDAQ Composite, and the S&P 500, all came down to their 50-day moving averages and attempted to hold support on Monday.  A weak close, however, presaged a resumption of the sell-off on Tuesday as 50-day moving average support melted away. An up open ran into solid resistance at the 50-day line and reversed... Read More

August 28, 2022

Second quarter GDP estimates on Thursday came in slightly better than expected, but they are still estimates and they are still negative. This indicates that the economy is on track for a second quarter of negative GDP growth, meeting the definition of a recession, at least as the government measures it. That perhaps brought a near-term oversold bid into the market as the prospect of a coming... Read More

August 24, 2022

After gapping below the 20-day exponential moving average on Monday, the S&P 500 held its ground yesterday and then posted a small rally today. The action was mostly about stocks which had been knocked down over the past week since my report of last Wednesday bouncing off areas of support today. The result was a quiet day with little overall index movement as the market awaits... Read More