Stocks & Bonds

Is The Options Market Signaling More Upside For Stocks?

One of my favorite indicators could be flashing a major buy signal here.  I’ve used the 21-day moving average of the CBOE options equity put call ratio a lot the past few months and it has done a good job of predicting things.  Here’s why it could now be sending a bullish signal. First off, to keep this simple, when this equity put call ratio trends lower – it has

Nasdaq 100 Breaks Out: Follow The Leader Part 2

There have been two important stock market lows this year and both came early on.  The first low came in February and ultimately could mark the low for 2014. The second one came in April and I would argue that it was the more important of the two.  Let me explain:  The April low saw a full retest of the February lows for the Nasdaq 100 (NDX) and Russell 2000 (RUT).

Why August Volatility Is Normal And Bulls Are Still In Charge

While in New York last week for a Yahoo Finance Contributor’s party, I dropped by the Wall Street Journal and shot a video with Paul Vigna for MoneyBeat. You can find the video at the bottom of this post, but one of the themes was August volatility and what to expect from this bull market. Here’s a summary of what we discussed: Seasonality is a big worry here. August and

Why European Stocks Demand Your Attention

As European stocks began to crack in early July, U.S. equities continued to climb higher. Although this divergence seemed minor at first, it would turn out to be a near-term warning for global investors. Indices like the S&P 500 would eventually follow European stocks lower. And when coupled with the recent stealth drop in the Euro, it’s apparent that concerns around the Russian-Ukraine conflict (and correlated markets) need to be on our collective

Insights From Oil and Elliott Wave: Where Will The S&P 500 Travel Next?

The market is under pressure and traders are eager to answer the question: will the S&P 500 (SPX) once again bounce off the channel it has neatly traded in since 2012 or endure a deeper pullback? The following three charts derive insights from Oil and Elliott Wave Theory to offer further perspective about where the market is trading and the support levels that traders will be keying in on in

Let’s Go Streaking! Insights Into A Maturing Bull Market

There are some amazing streaks happening right now that have many concerned the bull market has gone on for too long. Well, over at Yahoo Finance I asked the question how old is the bull market? You might be surprised, but my findings suggested this bull market might be mature, but I wouldn’t call it old when looking at past bull cycles. We’ve gone 34 months with a 10% correction,

RSI Reversals And Why Small Caps May Rise Again

Market technicians like finding and pointing out divergences whether they are bullish or bearish, myself included. That is why I would like to discuss using the RSI indicator in a different light and what I see developing in small caps, represented by the Russell 2000 ETF (IWM). More specifically, I’d like to discuss RSI reversals. Using RSI reversals to forecast a price objective was discovered by Andrew Cardwell, a leading authority, if not

How ‘Expensive’ Are Stocks? Comparing Today To 2000 And 1929

I spend a lot of time scouring the market for short-term tactical trading opportunities such as key reversal points, but it’s also very important to consider the big picture. Sometimes I like to step back and try to figure out which general direction the wind is blowing in the market. In other words, what is the overall trend? Is the market cheap or expensive? Some of my clients are “slow

Why August Options Expiration Could Bring Some Fireworks

This week is options expiration week, better known as OPEX.  Over the years, I’ve noticed this week tends to go the way of the overall trend, but also tends to be more extreme or magnified.  For example, some of the biggest drops back in 2008 tended to take place during OPEX, while more recently some of the best weeks during this bull market have taken place this week. You could

Follow The Fibs: Is The Russell 2000 Targeting 1262?

In January of 2013 I took an interest in the strength of the Russell 2000 (RUT) and did some pretty simple chart analysis. Basically the RUT went from an uptrend channel to what I call a PUT, a Power Up Trend.  Now that price has fallen out of the PUT, but is still well within the uptrend channel, let’s dig deeper using Fibonacci analysis. Below is the annotated chart for the