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Jason Haver: S&P, RUT, NYA -- Risk On? Not Quite Yet
While bullish sentiment seems to have returned in abundance, the markets have not yet signaled a full return to "risk on."
Jason Haver    

The S&P 500 (INDEXSP:.INX) has continued to power higher, largely unabated, and has now reached the zone that qualifies as a retest of the all-time high.  A lot of folks have now jumped back on the bull bandwagon because, after all, it's a bull market. However, there are still numerous markets showing that "risk-on" hasn't entirely returned to the menu yet. 

Among other things, the high-beta indices like the Russell 2000 (INDEXRUSSELL:RUT) and Nasdaq Composite (INDEXNASAQ:.IXIC) are still lagging the blue chips. The chart below shows RUT in the top panel (log scale) and the S&P in the bottom panel: 
 

Click to enlarge
 
Part of the "among other things" not shown in this update is the chart of the 30-year bond (USB), which is back-testing its recent breakout.  I remain bullish on the long bond for a trip toward 138.
 
The S&P 500 is retesting the all-time-high -- a "retest" of an intermediate level isn't an exact price, but rather is more of a price zone which extends slightly above and beneath the exact price -- and has reached a specific resistance point at 1884.  At least a near-term correction from here would be pretty normal.  In the event there's no immediate correction and the S&P breaks the all-time-high, then the red trend line is still the next pivotal resistance level.  Take a look at the long black trend line, which began back in May 2013, for an example of a similar pivotal level.
 

Click to enlarge
 
The NYSE Composite (INDEXNYSEGIS:NYA) is in a similar position, and the current price zone qualifies as the next big inflection point.  The last time I mentioned the market had reached an inflection point was on April 15, when it bottomed -- I was near-term bullish on that day, but in hindsight, was not bullish enough.  
 

Click to enlarge
 
In conclusion, there are essentially three stances one can take as an analyst: bullish, bearish, or neutral.  Neutral is probably the least popular with the crowd because people naturally crave resolution (nobody likes it when an episode of their favorite TV show ends with "To be continued.")   

But the reality is, some markets beg to be anticipated, some beg to be reacted to, and some beg for the patience of limiting oneself to only the lowest-risk entries in both directions.  The market has now reached another inflection point, which means it hasn't quite closed the book on either the bulls or the bears just yet.  I think bears have a good shot at turning the market here, at least for the near-term -- so, for the moment, just put me down as near-term bearish with "a chance of bigger thunderstorms."  Trade safe. 
 
Follow me on Twitter while I try to figure out exactly how to make practical use of it: @PretzelLogic.

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
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No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Jason Haver: S&P, RUT, NYA -- Risk On? Not Quite Yet
While bullish sentiment seems to have returned in abundance, the markets have not yet signaled a full return to "risk on."
Jason Haver    

The S&P 500 (INDEXSP:.INX) has continued to power higher, largely unabated, and has now reached the zone that qualifies as a retest of the all-time high.  A lot of folks have now jumped back on the bull bandwagon because, after all, it's a bull market. However, there are still numerous markets showing that "risk-on" hasn't entirely returned to the menu yet. 

Among other things, the high-beta indices like the Russell 2000 (INDEXRUSSELL:RUT) and Nasdaq Composite (INDEXNASAQ:.IXIC) are still lagging the blue chips. The chart below shows RUT in the top panel (log scale) and the S&P in the bottom panel: 
 

Click to enlarge
 
Part of the "among other things" not shown in this update is the chart of the 30-year bond (USB), which is back-testing its recent breakout.  I remain bullish on the long bond for a trip toward 138.
 
The S&P 500 is retesting the all-time-high -- a "retest" of an intermediate level isn't an exact price, but rather is more of a price zone which extends slightly above and beneath the exact price -- and has reached a specific resistance point at 1884.  At least a near-term correction from here would be pretty normal.  In the event there's no immediate correction and the S&P breaks the all-time-high, then the red trend line is still the next pivotal resistance level.  Take a look at the long black trend line, which began back in May 2013, for an example of a similar pivotal level.
 

Click to enlarge
 
The NYSE Composite (INDEXNYSEGIS:NYA) is in a similar position, and the current price zone qualifies as the next big inflection point.  The last time I mentioned the market had reached an inflection point was on April 15, when it bottomed -- I was near-term bullish on that day, but in hindsight, was not bullish enough.  
 

Click to enlarge
 
In conclusion, there are essentially three stances one can take as an analyst: bullish, bearish, or neutral.  Neutral is probably the least popular with the crowd because people naturally crave resolution (nobody likes it when an episode of their favorite TV show ends with "To be continued.")   

But the reality is, some markets beg to be anticipated, some beg to be reacted to, and some beg for the patience of limiting oneself to only the lowest-risk entries in both directions.  The market has now reached another inflection point, which means it hasn't quite closed the book on either the bulls or the bears just yet.  I think bears have a good shot at turning the market here, at least for the near-term -- so, for the moment, just put me down as near-term bearish with "a chance of bigger thunderstorms."  Trade safe. 
 
Follow me on Twitter while I try to figure out exactly how to make practical use of it: @PretzelLogic.

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap
Jason Haver: S&P, RUT, NYA -- Risk On? Not Quite Yet
While bullish sentiment seems to have returned in abundance, the markets have not yet signaled a full return to "risk on."
Jason Haver    

The S&P 500 (INDEXSP:.INX) has continued to power higher, largely unabated, and has now reached the zone that qualifies as a retest of the all-time high.  A lot of folks have now jumped back on the bull bandwagon because, after all, it's a bull market. However, there are still numerous markets showing that "risk-on" hasn't entirely returned to the menu yet. 

Among other things, the high-beta indices like the Russell 2000 (INDEXRUSSELL:RUT) and Nasdaq Composite (INDEXNASAQ:.IXIC) are still lagging the blue chips. The chart below shows RUT in the top panel (log scale) and the S&P in the bottom panel: 
 

Click to enlarge
 
Part of the "among other things" not shown in this update is the chart of the 30-year bond (USB), which is back-testing its recent breakout.  I remain bullish on the long bond for a trip toward 138.
 
The S&P 500 is retesting the all-time-high -- a "retest" of an intermediate level isn't an exact price, but rather is more of a price zone which extends slightly above and beneath the exact price -- and has reached a specific resistance point at 1884.  At least a near-term correction from here would be pretty normal.  In the event there's no immediate correction and the S&P breaks the all-time-high, then the red trend line is still the next pivotal resistance level.  Take a look at the long black trend line, which began back in May 2013, for an example of a similar pivotal level.
 

Click to enlarge
 
The NYSE Composite (INDEXNYSEGIS:NYA) is in a similar position, and the current price zone qualifies as the next big inflection point.  The last time I mentioned the market had reached an inflection point was on April 15, when it bottomed -- I was near-term bullish on that day, but in hindsight, was not bullish enough.  
 

Click to enlarge
 
In conclusion, there are essentially three stances one can take as an analyst: bullish, bearish, or neutral.  Neutral is probably the least popular with the crowd because people naturally crave resolution (nobody likes it when an episode of their favorite TV show ends with "To be continued.")   

But the reality is, some markets beg to be anticipated, some beg to be reacted to, and some beg for the patience of limiting oneself to only the lowest-risk entries in both directions.  The market has now reached another inflection point, which means it hasn't quite closed the book on either the bulls or the bears just yet.  I think bears have a good shot at turning the market here, at least for the near-term -- so, for the moment, just put me down as near-term bearish with "a chance of bigger thunderstorms."  Trade safe. 
 
Follow me on Twitter while I try to figure out exactly how to make practical use of it: @PretzelLogic.

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
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