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Market Commentary

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Did I Just Mention Christmas?

Before I get too far this morning, I need to step back just a bit, just before this past three-day weekend.

  • Memorial Day weekend is poised to be the busiest in a decade. According to the American Automobile Association and IHS Global Insight, about 37.2 million travelers are forecasted to travel by air and road during the weekend. This would be the highest travel volume since 2005.

I don’t know if it actually panned out the way, but I suspect it did, as nobody has their finger on the pulse ...

May 26, 2015
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Will Gravity Tug Nasdaq Back To Earth?

Both the Nasdaq Composite and the Nasdaq 100 are probing new high territory, while the major indices look tired. Institutional funds have been flowing out of U.S. equities since the first of the year, which accounts for the choppy and lackluster performance of the major indices .

That said, most institutions don’t invest in small caps or the Nasdaq 100, which is perhaps one reason these two indices continue to be tradable. i.e. they can generate multi-day trends.   

Reid_5-26-2015_NQ.png

At the moment the trend i...

May 26, 2015
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This Is A Great Environment For Stock Picking

It always strikes me with curiosity that when markets are at a crossroads we start reaching for expert opinions.  We hate uncertainty, which creates doubt and usually the wrong decision.  For so many of us being long the market has been the right decision, yet the game has to turn at some point, right?  And who wants to be left holding the bag when everyone else has cleaned house.  How do we get out of the way, and when will we know it?

That, of course is a market timing bet - and as a stock ...

May 26, 2015
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Let’s Stay At The Top Of The Food, Water, And Energy Chains

Humans are great – when things get rough, the smart get going. We have risen to the top of the food chain because we can think our way out of problems. Sure, it often takes a crisis to get the smart going, but once they do get a thinkin’, the problems we face get smaller.

  • Google has developed software that can run on low-power devices and give them the ability to communicate with other connected devices nearby.

The above might seem obvious and inconsequential in this day of wireless everythin...

May 22, 2015
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Nasdaq Poised To Play Catch Up

After some late afternoon profit-taking on Wednesday, the stage was set for a nasty megaphone pattern on the 60 min NQ chart, which would resolve down at the Weekly Pivot .

The only thing standing in the way was support from a High Volume Node at 4489 On Thursday, the opening 30 minute bar tested this critical area and it held. That was an all-clear signal for the resumption of the uptrend, as indicated by the blue dashed channel.

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This suggests that the Nasdaq will now play catch-up with...

May 22, 2015
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Featured Stories

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Chart Warns S&P 500 Could Be Near Short-Term Top

The S&P 500 had a pretty interesting week in the run-up to the Memorial Day holiday. It made a new all-time high at 2134.72, and it closed Friday at 2126.06, the first time it has managed to close above the high set in April. That’s the good news.

The bad news is that the range for the week was extremely narrow — roughly 14 points, which is hardly a decent range for a single day — the momentum was very weak, and the volume was very low, as it has been for most of this month.

We got up there,...

May 26, 2015
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US Labor Market Coming To A Boil

Despite a recent host of weak and weaker than expected economic data the employment picture remains robust. Aside from one month of poor non-farm payrolls data the sector remains strong with positive expectations into the future. One proof of that is the rebound in NFP we saw for April. The number jumped back above 200,000 and into the range commonly agreed to represent health, if not strength, in job creation. Further evidence can be found in the Kansas City Federal Reserve's Index of Labo...

May 21, 2015
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Wheat Reality

Last Thursday’s weekly export sales report for wheat showed 115 thousand metric tons. That was old crop numbers with new crop numbers coming in at 142 thousand.  Clearly demand is not a driving force and for months hasn’t been in wheat.  Demand looks to remain weak until the new crop in the field shows its strength.  The Monday’s crop condition report showed 45% of the crop in good to excellent condition. We need over 60% good to excellent condition to make us a primary port of origin for hig...

May 20, 2015
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5000 Years of Data

Systematic futures traders are invariably plagued by the small set of available daily data upon which to develop and test strategies. The last data revolution was the introduction of 24 hour electronic contracts starting in 2000.  Only a few symbols go back that far and many of them start much later.   Although some futures have a longer history, it is not helpful to back-test prior to 2000 because markets changed radically with the introduction of electronic futures. Consequently systematic ...

May 13, 2015
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Alcoa (AA) – A Leading Industrial Play on the Growing Global Aerospace and Automotive Sectors

AA, the largest aluminum producer in the U.S., returned nearly 50% in 2014, as the combination of rising aluminum prices , efficiency gains, and a 7% growth in global aluminum demand drove AA’s 2014 net income to $268 million, its highest calendar-year profit since 2011. For the U.S. aluminum industry as a whole—taking into account the three largest U.S. aluminum companies, i.e. Alcoa , Century Aluminum , and Kaiser Aluminum as a proxy—total 2014 net income was $452 million. This was also th...

May 13, 2015
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