Mid-week market update: As the major market averages make new all-time highs, I conducted an informal and unscientific Twitter poll. I was surprised to see how bullish respondents were. Let's just cut to the chase - forget it. Neither the fundamental nor the technical backdrop is ready for an advance of that magnitude....
The WSJ reported that the Trump administration is considering a new tactic in managing its trade relationship with China. Here is the Bloomberg recap for those without a WSJ subscription: Under the plan, the commerce secretary would designate the practice of currency manipulation as an unfair subsidy when employed by any country, instead of singling...
The chart below depicts the yield curve, as measured by spread between the 10-year and 2-year Treasury yields, (blue line) and equity returns (grey line). The yield curve has been an uncanny recession forecaster. It has inverted ahead of every single recession, and warned of major equity bear markets. Unfortunately, this indicator may...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The...
Mid-week market update: Increasingly, I have seen cases being made for an equity market correction. This Bloomberg article, "Five charts that say not all is well in the markets" summarizes the bear case well. Uncertainty is at a record high: The number of news stories using the word "uncertainty" is surging. Wall Street vs. Washington:...
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