July 30th: Ed’s Daily IRA Summary   3 comments

Ed’s IRA: 0.10%
DJIA: -0.19%
Nasdaq: 0.45%
S&P 500: 0.01%

Posted July 30, 2014 by edmcgon in Open Thread, Portfolio

Traders Corner   20 comments

The S&P 500 levels to watch today:

UPSIDE: 1972-1986 (24 data points and the 20 day moving average), 1989 (July 23rd’s high), 1990 (top of the Bollinger Bands), and 1991 (July 24th’s high and the all-time high).
LAST CLOSE: 1969, inside the 1967-1969 (4 data points and June’s high) range.
DOWNSIDE: 1965 (3 data points), 1962 (July 1st’s low), 1959-1960 (3 data points and the bottom of the Bollinger Bands), 1955 (July 17th’s low), 1952 (July 10th’s low), and 1950 (50 day moving average).

S&P 500 Daily Momentum: Bearish
S&P 500 Daily Overbought/oversold: Neutral
S&P 500 Weekly Momentum: Mixed (trending bearish)
S&P 500 Weekly Overbought/oversold: Neutral
S&P 500 Futures: Positive
Overall: The S&P 500 finally broke out of the 1972-1986 range, and even finished below the 20 day moving average. With futures pointing up today, will the market break out of the recent bearish momentum? I am leaning towards an SPXU play after the opening pop this morning. Of course, this could all change depending on the market’s reaction to this morning’s U.S. GDP report.

Happy Fed Day! Ed’s Daily Notes for July 30th   Leave a comment

janet-yellen-money-printer

And what a Fed Day it is! We open with the U.S. 2nd Quarter GDP report at 8:30 am EST, before getting the Federal Reserve’s Open Market Committee meeting announcement at 2 pm EST.

Bloomberg: Housing Market in France in ‘Meltdown’ After Hollande Rent Caps

For those of you looking for government to solve all problems, take a lesson from France:

French President Francois Hollande’s government may have made a housing slump worse, pushing the construction market to its lowest in more than 15 years.

Housing starts fell 19 percent in the second quarter from a year earlier, and permits — a gauge of future construction — dropped 13 percent, the French Housing Ministry said yesterday.

The rout stems from a law this year that seeks to make housing more affordable by capping rents in expensive neighborhoods. To protect home buyers, the law also boosted the number of documents that must be provided by sellers, leading to a decline in home sales and longer transaction times. While the government is now adjusting the rules, the damage is done, threatening France’s anemic recovery that’s already lagging behind those of the U.K. and Germany.

“Construction is in total meltdown,” said Dominique Barbet, an economist at BNP Paribas in Paris. “It’s difficult to see how the new housing law is not to blame.”

Barbet says the drop in home building lopped 0.4 points off France’s gross domestic product growth last year and cut the pace of expansion by a third in the first quarter. Expenditure in the sector was at its lowest level ever as a portion of total real GDP in the first quarter at 4.7 percent, down from 6.3 percent in the first three months of 2007, he estimates.

Sales of new-build homes fell 5 percent in the first quarter from a year earlier and are down by about a third compared with their level in 2007, according to Credit Agricole.

Posted July 30, 2014 by edmcgon in Economy, Federal Reserve, News, Real Estate

July 29th: Ed’s Daily IRA Summary   2 comments

SPXU was a good daytrade for me early today:

Ed’s IRA: 0.08%
DJIA: -0.42%
Nasdaq: -0.05%
S&P 500: -0.45%

Posted July 29, 2014 by edmcgon in Open Thread, Portfolio

Traders Corner   25 comments

The S&P 500 levels to watch today:

UPSIDE: 1989 (July 23rd’s high), and 1991 (July 24th’s high and the all-time high and the top of the Bollinger Bands).
LAST CLOSE: 1978, inside the 1972-1986 (23 data points and the 20 day moving average) range.
DOWNSIDE: 1967-1969 (3 data points and June’s high), 1965 (3 data points), 1962 (July 1st’s low), 1959-1960 (3 data points), 1958 (bottom of the Bollinger Bands), 1955 (July 17th’s low), 1952 (July 10th’s low), and 1948 (50 day moving average).

S&P 500 Daily Momentum: Bearish
S&P 500 Daily Overbought/oversold: Neutral
S&P 500 Weekly Momentum: Mixed (trending bearish)
S&P 500 Weekly Overbought/oversold: Neutral (leaning overbought)
S&P 500 Futures: Flat (leaning positive)
Overall: Watch the S&P 500’s 1972-1986 range. Aside from the 23 highs and lows inside that range this month, we have also seen 13 closing prices within it. Without market-moving news, don’t be surprised to see the S&P 500 return to this range if it moves outside of it.

Ed’s Daily Notes for July 29th   7 comments

Aside from the beginning of the Federal Reserve’s Open Market Committee meeting today, watch the Case-Shiller Home Price Index, released at 9 am EST this morning. Last month’s report showed a disappointing 0.2% seasonally adjusted increase (only a 1.1% increase without the seasonal fudging). Could we be seeing a dip in home prices in correlation with the dip in the Fed’s quantitative easing? It would make sense, but it would also portend bad things coming with the end of QE scheduled for October.

Daily Mail: Google can predict the stock market: Researchers find search engine can spot crashes BEFORE they happen

Google searches for business and politics topics can predict a future stock market crash, researchers have claimed.

An analysis of search terms between 2004 and 2012 found an increase in internet searches preceded falls.

Researchers from Warwick Business School said search behaviour could provide an early warning system of concerns about the state of the economy.

While I think a pattern between searches and stock market behavior could be found, I am not sure this research is thorough enough. An 8-year period just isn’t long enough to be definitive, especially considering we only had one severe crash during the period. As an investor, I don’t care about little 5 or 10% corrections. I want to know when the market is going to drop by 30% or more. There just aren’t enough severe market events during the 2004-2012 period to make it statistically conclusive.

Fox Business: Smith & Wesson Fined $2M Over Foreign Bribery Charges

Smith & Wesson (SWHC) on Monday agreed to pay a $2 million fine to settle charges that employees and company representatives paid foreign officials to win supplier contracts, according to the Securities and Exchange Commission.

The SEC said Smith & Wesson logged about $100,000 in profits from the one contract that was completed before the Foreign Corrupt Practices Act violations, which occurred between 2007 and 2010, were identified.

Maybe it’s just me, but I find this hilariously hypocritical. How many companies give even larger sums to U.S. politicians to win U.S. government contracts? This is chump change.

Posted July 29, 2014 by edmcgon in Economy, Federal Reserve, News, Politics

July 28th: Ed’s Daily IRA Summary   1 comment

I didn’t daytrade today. I wasn’t comfortable with the market’s reaction this morning.

Ed’s IRA: 0.00%
DJIA: 0.13%
Nasdaq: -0.10%
S&P 500: 0.03%

Posted July 28, 2014 by edmcgon in Open Thread, Portfolio

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