Category Archives for "Market Analysis"

Compression Week in the Stock Market

compression week

The big event for the stock market this week was the Federal Reserve Meeting on Tuesday-Wednesday. On Wednesday the Federal Reserve announced no change to interest rates but did say they plan to wind down their $4.5 trillion balance sheet starting in October. 

This is the balance sheet that they created thru the series of quantitative easings since the Financial Crisis.  This $4.5 trillion balance sheet is made up of treasuries and mortgage backed securities. 

So it is not unusual for the stock market to become a little cautious and tight during a Fed meeting but this tightness continued thru the remainder of the week. When you see the Dow Jones Industrial Average (DJIA) weekly chart in the video below, you will see why I am calling this a compression week.  It is one of the smallest weekly trading ranges in several months. 

Compression and expansion seem to cycle back and forth in the stock market.  So now that we have had a compression week, I am watching for some fireworks to happen in the market…it may take a couple of weeks.

This is like a flag being waved saying ‘hello, the market is telling you something’. Like a big cat watching you. You never know when if is going to explode into action.

In the video I review the DJIA daily and weekly charts, look at one of my key indicators and review 3 key ETFs.  This is just a brief snippet of what I provide my Insider Members in the Weekend Market Analysis video.  Also in today’s video I review Apple (AAPL), Facebook (FB) and Netflix (NFLX). 

 

Missiles of September…No Worries??

missiles of September

The stock market blasted off last Monday after Hurricane Irma turned out to be a little less damaging than expected and North Korea did not launch their missiles of September program, over the weekend.  The rally continued a little less robustly into quad witching day on Friday.

The stock market was up on Friday even after North Korea launched another missile over Japan, around 5pm CT on Thursday. This was the second time in less than a month that North Korea launched a missile over Japan.  I’m sure the folks in Japan love hearing the sirens go off and worrying about a nuclear bomb dropping on their heads. Continue reading

Stock Market Update…Storm Coming

storm coming

There is indeed a storm coming to Florida as hurricane Irma hits the state this weekend. I sincerely hope everyone’s family and friends will be safe. We are very concerned, as my in-laws are hunkered down in a community center in Palm Harbor (near Tampa Bay). The storms path is now headed directly over Tampa Bay as it heads north.

But there is also a storm coming to the stock market. It almost feels like the lull before the storm right now.  Things can change very quickly.  Today’s brief market update video is a snippet of what I review with my Insider Members.   Continue reading

August Selloff…Normal August Type Activity?

As I was working on a weekday market wrap video for my members the other day, I happen to have Jim Cramer’s Mad Money show on the TV…turned down low. I usually don’t watch the show, but this time I did over hear him talking about the August selloff.

He was basically telling people to relax, it’s August. The market is doing its August type of price action.  So it got me wondering… is having an August selloff, just normal August type action. Continue reading

VIX Exploded This Week Under Extreme Compression, How Much Higher?

VIX exploded

The CBOE Volalitiy Index, VIX exploded this week, up 55% from the close last Friday.  It closed the week at 15.51 after hitting a high of 17.28 on Friday. It has been coiling tighter and tighter for the last 18 months.  In fact this coiling process occurred throughout the entire 5th Intermediate Wave up in the market that started in February 2016.

Explosion

The explosion this week actually began on Tuesday as the VIX broke higher out of a beautiful bull flag that I was monitoring for my Insider Members. On Tuesday the VIX closed at 10.96.  It is also interesting to note the reversal candle that occurred on July 27 which started this entire move. See chart below. Continue reading

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