The Market Is Reveling In Great Q1 Earnings

The stock market had the tailwind of Macron’s victory at its back, but it didn’t rally Monday morning. As I was predicting from a few weeks ago Macron, the centrist investment banker, won the French presidential election in a landslide. Macron received 66.1% and Le Pen received 33.9% which was below what most of the…

The Bitcoin Price Briefly Soars Above $1,600

Bitcoin Temporarily Explodes Higher Bitcoin has been skyrocketing lately. One month ago, the price of bitcoin was $1,139. By early Thursday it was at $1,567. That’s a 37.6% rally. It’s a hyperbolic increase which is unsustainable. Whenever any asset goes hyperbolic, it’s best to step out of the way and stop buying. As a reminder,…

Stocks Haven’t Moved 0.2% In 8 Days

The S&P 500 reached a new all-time closing high on Friday. It’s notable how tight of a range stocks have been in recently. There’s been 8 consecutive days without a 0.2% move in stocks. As you can see from the chart below, that’s the longest streak since 1964. The all-time longest streak is 10 days,…

Good News From Washington D.C.

Thursday’s action seems to be unusual because everything that came out of the fiscal policy front was positive, but stocks didn’t move higher. The S&P 500 has closed at almost the same level for a few days. The VIX was below an 11 handle once again, signaling not even a whiff of risk is on…

Fed Expected To Hike Again In June

This article will focus on the Fed’s May meeting where it decided to maintain the federal funds rate between 75 and 100 basis points. The stock market had a slight increase in response to the decision, but that may have been because Apple rallied throughout the day after opening lower. The 10-year bond yield increased…

Volatility Craters As The Nasdaq Soars

Volatility is extremely low and stocks have relentlessly rallied. The rally has not been even among the indices with the Nasdaq outperforming and the Russell 2000 lagging. The Nasdaq is up 12.65% year to date even after being down Wednesday partially because of Apple’s earnings disappointment. The Russell 2000 is only up 2.39% and underperformed…

Oil Investment Boosts GDP Growth

Oil Drives Weak GDP Growth I would like to continue the discussion about oil’s impact on the Q1 GDP growth report. Q3 2016 had great growth which was surprising because economic growth has been tepid. It led to an extensive review of the report which led to the realization that it was temporarily boosted by…

Car Sales Remain Weak While Realized Volatility Plummets

Auto sales were responsible for the weak durable goods orders in the GDP report. It could be the catalyst of a recession. Therefore, it’s critical to focus on every new data point available in the car market. The latest information we have is in the chart below. As you can see Nissan, Toyota, Fiat Chrysler,…

Weak Soft Data A New Trend?

The new trend I am focusing my attention on is the deceleration of soft data. I am predicting this decline because soft data usually doesn’t surprise to the upside for long. It’s also clear that the hard data isn’t following suit which means the economy isn’t strong. The weak GDP report acts as a signal…

Earnings Growth And GDP Growth Diverge

There’s an anomaly which is playing out in Q1. Earning growth is accelerating, while the economy is decelerating. This is a point I’ve been making for a few weeks. I expect the Q1 earnings growth rate to be the peak of the year and I expect GDP growth to remain weak throughout the year. This…