Editor’s Weekly Market Thoughts – Feb 29, 2016

Most investors struggle with understanding the fluctuations of the markets and how to trade within them. A typical buy-and-hold investor who has been in the markets over the past 14 months has spent a great deal of emotional energy, and savings. Since January 2015, the SPX has returned -5.48%. Though this is far better than just a few weeks ago …

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Editor’s Weekly Market Thoughts – Feb 15, 2016

On Friday we have had a relief rally and a lot of investors with long positions are excited. However, in this period of extremely high volatility the chance for a head fake still remains. That’s why it’s better to validate a real rally than anticipate it. Very high volatility is creating intra-day swings that can take out even some of …

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Editor’s Weekly Market Thoughts – Jan 18, 2016

When the stocks that institutions buy keep getting slammed back and forth without a positive trend, the institutions finally lose interest and start moving money to cash or the treasuries. Big bar swings are not healthy for bull markets. When volatility remains high for an extended period, it discourages investment. Historically, volatility increases when interest rates move too high (5 …

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Editor’s Weekly Market Thoughts – Jan 2, 2016

It is likely that 2016 financial markets will begin with high levels of volatility. Presently VIX is higher than during the strong uptrend years between 2012 and 2014. If we look back at history, higher volatility precedes bearish market declines, such as seen in the years 2000, 2007, 2010 and 2011. While higher volatility is a warning that markets could …

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Editor’s Weekly Market Thoughts – Dec 21, 2015

Volatility has been at its peak this year dominating these choppy markets. Fund managers are desperate to deliver decent results and volatility is not helping them. The reality is that it is going to be a tough year to show big returns even for us market timers. We earn our paycheck mostly during bear markets. Now here are some facts …

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Editor’s Weekly Market Thoughts – Dec 14, 2015

For almost two decades when the junk bond market and the stock market diverged; it was the junk bond market that proved observant. When junk bonds and stocks disagree, Junk bonds tend to be right. Weakness in the High yield bonds with credit ratings below investment grade and fears of meltdown have increased after high-yield mutual fund Third Avenue Focused …

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Editor’s Weekly Market Thoughts – Nov 16, 2015

There is a strong belief that the Fed will hike interest rates in December 2015. So far any rally has been basically about the large-cap stocks. The next stage of any rally needs to be driven by higher beta-growth stocks. The small-caps have largely underperformed since June. Bulls like to see small-cap growth names doing better than large-caps, as it …

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Editor’s Weekly Market Thoughts – Nov 9, 2015

It was very clear on Friday last week that there is not much room for S&P 500 to go up any further. As we strongly preach the trailing stop price it is imperative for our clients to refer daily to the website and get the stop-price updates for open positions. You cannot overlook this daily discipline, which only takes 5 …

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Editor’s Weekly Market Thoughts – Nov 2, 2015

In this week’s “market thoughts” we will use the opportunity to expand on one of our newer trading systems, Currency Trader System. Some of our clients have asked us for a more in-depth explanation of the notion of using futures to trade in currencies, as opposed to buying ETFs on NYSE. In our currency trading system our rules of engagement …

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Editor’s Weekly Market Thoughts – Oct 27, 2015

Markets raced higher on Friday as short term cycles did form that “higher low” pattern we expected. We are likely to see markets run up to form the next top and one that could equal or even surpass the high of July 20. We clearly have a short term bull trend going on and pullbacks normally make markets stall with …

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