Category: Asymmetric Hedging
-
After Selling Pressure Drives Stock Price Trends to a Low Enough Level, We’ll See Sentiment Shift
Once the stock market catches a break and trends up enough, we’ll probably see short covering keep it going for a while. The percent of stocks trading above their 50 and 200 day averages is… Read More
-
Fundamental Valuation: Is the Stock Market Cheap or Expensive?
For me, and everyone else even if they don’t realize it, the price trend is the final arbiter. For more than two decades, I’ve focused my efforts on developing systems to identify trends early in… Read More
-
Historic day for the stock market
Today was just a reversal of Friday’s late-day surge. The stock market is even more washed out. With the Federal Reserve lowering interest rates and buying back bonds, the long term US Treasury Index reversed… Read More
-
Profiting from the Madness of Crowds
If we want to profit from the madness of crowds, we necessarily need to believe and do different things than the crowd at the extremes. You may have heard the stock market was down a… Read More
-
Dow Jones is down -10% off its high
Dow Jones is down -10% off its high. I don’t pay much attention to the Dow Jones Industrial Average as it’s a price-weighted index of 30 stocks. But, the S&P 500 capitalization-weighted index of approximately… Read More
-
Employment, Coronavirus, it’s just the market, doing what it does…
It seems most people probably believe the news drives the stock market. I can see why, since the news headlines want to tell a story. We like a great story. We want to hear the… Read More
-
19 is the new 20, but is this a new low volatility regime?
We used to say the long term average for the Cboe Volatility Index VIX is 20. Some would mistakenly say that VIX “reverts to the mean”, suggesting it is drawn to the average level of… Read More
-
Investor sentiment is dialed up with stock trends
I believe there are many factors that drive stock prices and one of them is investor sentiment. However, enthusiasm and panic can also reach extremes, which drives the opposite trend. When investors are extremely bullish… Read More
-
Volatility is expanding, a little
To no surprise, the CBOE S&P 500 Volatility Index that represents the market’s expectation of 30-day forward-looking volatility, is trending up. So far, it isn’t much of a volatility expansion, but it’s elevated somewhat higher… Read More
-
Investor sentiment signals greed is driving stocks as the U.S. stock market reaches short term risk of a pullback
The Fear & Greed Index reaches the Extreme Greed level as I got a short term countertrend sell or hedge signal for U.S. stocks. Investors are driven by two emotions: fear and greed. Too much… Read More