Posts From Andrew Kassen

Andrew Kassen
Andrew has traded privately for over 10 years. Well-studied in technical and quantitative analysis, as a trader he employs a rigorous price-based process for short-term trading of futures (with specialization in the Russell 2000 mini contract, TF) and spot Forex. As a writer his primary interests lie in the ongoing technical analysis of markets and at the intersection of philosophy, cognitive psychology and finance.
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Unbroken Cycle: Why Stocks Are Poised To Drop As QE Comes To A Stop

How do stocks react when the Fed begins to tighten rates?  How do they react when markets begin to anticipate the inception of a new tightening monetary policy regime? For years the FOMC has maintained a Zero Interest Rate Policy (ZIRP), effectively relegating these questions to academic interest only, rendering them moot for investors and traders allocating capital and managing risk in an environment awash in dirt-cheap liquidity. A quick

Why Market Volatility Is About To Make A Big Comeback (In 50 Charts Or Less)

2014 continues to build it’s reputation as a year full of counterintuitive market dynamics: Q2′s zombie volatility has (finally?) subsided – just as the seasonal period known as the Summer Doldrums is scheduled to kick in. Some of the shine has come off broad momentum trades active investors have piled into such as High Yield Corporate Bonds (HYG), Semiconductors (SOX) and Biotech IBB). Despite positively-received Q2 Earnings, Major Regional (KRE)

Negative Interest: Are Major US Banks Installing a Cyclical Top?

With Q2 Earnings out of the way for TBTF Banks Systemically Important Financial Institutions (SIFI) in the US it’s time again for a brief checkup of the technical health of Money Center Banks. Amidst a faltering sector on the threshold of a (probable) cyclical tightening regime (with the reduction/elimination of IOER) and earnings distended with the bloat of aggressive buyback programs, shares of major US banks continue to stagger through

Is the Light of Positive Employment Data Pointing to a Safe Harbor for Stocks?

Ahead of today’s Employment Report (NFP), we took a look yesterday at the S&P 500′s (SPX) performance on Fridays over the last year in general, and NFP Days in particular. With the S&P off 0.75% at mid-day, it looks as though stocks may buck the prevailing trends of the last 12 months – 28/52 Fridays up, including the last 10/11; and 10 of 12 NFPs up – to start August

A Field Guide to Unemployment Friday Stock Performance

Despite (or because of) the punishment stocks sustained Thursday, many traders, active investors and market observers seem relatively well-assured equity markets won’t sustain anything more than a mild pullback. Bolstering this view is the near-universal recognition that Friday has (once again this year) assumed the mantle from Tuesday for the latter half of the year as the session for equity outperformance. Courtesy of our friends at J. Lyons Fund Management,

Melting Up: How Will A Positive 2nd Quarter GDP Print Impact Stocks?

Are Q1′s Frigid Economic Performance And Resulting Fears of Recession About to Thaw in Light of a Sunny 2nd Quarter GDP Print? Will the Market Warm to a Positive Report; or Could July’s Gains Melt Away Instead? At 8:30 a.m. ET this Wednesday the Bureau of Economic Analysis (BEA) will release it’s Advance GDP reading for April-June 2014, the first of three monthly reports covering 2nd Quarter GDP. Despite Q1′s

Semiconductors: Is the Charge About to Die?

In striking contrast to 2014′s dominant theme of “record low volatility” and the numbingly granular tedium with which it has been analyzed, some US equity sectors and industries have never stopped partying following 2013′s outlying bullish performance. A few have left pundits perplexed (e.g. Utilities continues to outperform it’s sector peers year-to-date), but others are held up as an affirmation that the post-crisis cyclical bull market – now well into

Breakdown: Why EUR/USD Volatility Is Ready to Resume

Single-day paroxysms brought about by geopolitical unrest and local black swan events aside, stocks continue to calmly shuffle through a dream-like state of imploded volatility as the “bubble in certainty” persists.  While many active investors are focused primary on equities, however, it’s important to recall this condition of zombie volatility is global in scope, sweeping in nearly every asset class across most developed and emerging markets. One of the most

The Reach For Yield: A Monster of the Fed’s Own Design

“The Committee recognizes that low interest rates may provide incentives for some investors to “reach for yield,” and those actions could increase vulnerabilities in the financial system to adverse events. While prices of real estate, equities, and corporate bonds have risen appreciably and valuation metrics have increased, they remain generally in line with historical norms. In some sectors, such as lower-rated corporate debt, valuations appear stretched and issuance has been

Biotech Sell Off: Bearish Harmonic Bat, H&S Top Patterns Point Lower

The closely-followed iShares Biotechnology ETF (IBB) continues to show technical deterioration following it’s mini-blowoff in late June/early July to complete a 4-month Bearish Bat harmonic pattern near $266. Over the last 4 weeks, IBB – amidst a broader environment justifiably referred to as “manic” or “bubbly” – has built out a Head & Shoulders Top pattern from which it has broken down during Wednesday’s session in trade below its neckline