Ready for Holy Days?
It's one of those years when Passover and Holy Week more or less coincide. For all of you observing one or the other, it's time to re-focus from work and from the frivolous and feed your soul. That's where I'm heading. I hope you are too.
Before exiting the scene, a few quick comments:
First, more a question: Is the "Melt-Up" still on tap? Or has the recent turbulent drop in stock prices signalling the first vestiges of a bear market? I really don't know. On the one hand, it's hard to consider the parabolic move up in stocks as a real Melt Up. It was short and sweet. But Melt-Ups usually take a life of their own and suck in a wide swath of eager buyers dreaming of hitting the lottery by buying stocks (or other items like, let's say, bitcoin) that promise quick, "can't miss" riches. If you remember the tech wreck, "everyone" was convinced that tech companies, even though they had risen to unfathomable and unsupportable heights, were going literally to the moon. Even some famous hedge fund geniuses jumped in with both feet, and this after warning of an impending crash. The rise was simply that powerful and convincing. With that in mind, this recent rise doesn't seem or feel anything like what I could call a Melt-Up. But what do I know?
On the other hand, we're watching the Dow and the Transports closely. They've come close to a Dow bear market signal. Having hit all-time highs, they both turned down. Having turned down, they both rose again, but not to the previous highs. Having risen, they both turned down with the Dow falling below the previous low. The Transports, on the other hand, while they also fell, did not fall below their February lows - at least as of market close today. If that holds, we don't have a classic Dow Theory bear signal. Then again, a bear signal was given in 2016 - one that turned out to be unreliable. So just relying on this Dow Theory signal formula may not provide a definitive answer.
Markets are funny that way.
If we look at bonds, everyone continues to tout the end of the long bull market that began around 1980. Naturally, with more people jumping on board that bandwagon, we've had a rally in bonds. So we'll probably go into the holy days with a question mark in bonds, one that has consistently emerged each time the bond bull has threatened to die.
We'll skip any attempt at an analysis of gold, since it's a typcially weak season for that precious metal. So the recent gains falling back to earth are no surprise. We'll likely get a better idea of whether gold will or won't resume it's great bull market later in the year. That bull market begun around 2000 corrected beginning in 2011 and, while it has shown signs of strength since 2016, has never really caught fire - yet.
One thing I suggest we might all agree upon as the holy days draw nearer is this: Temper your exposure to daily news stories. It's a good general rule, but especially makes sense when days like Holy Thursday, Good Friday, Easter, and Passover are upon us. There are better ways to engage your mind, and better places to rest your heart than the typically superficial drivel that comprises most so-called "news" stories. To encourage you further in this, here's a passage - in the form of advice - I came across recently. The author was trying to encourage his reader to consider what sort of reading and study was worth their time. In the course of his discussion, he turns to "newspapers," since he was writing in 1946. (Remember: No internet, no smart phones, no personal computers, no digital anything.)
"As to newspapers, defend yourself against them with the energy that the continuity and the indiscretion of their assault make indispensable. You must know what the papers contain, but they contain so little; and it would be easy to learn it all without settling down to interminable lazy sittings!"
Yes, defend yourself! You can certainly do wtihout your "feeds" at a time when you're trying to enrich your soul with things relgious and spiritual. And if you can manage to control your appetite for useless images and verbiage during the coming holy days, maybe some of that will spill over into your life in general. Consider it. It will benefit you greatly.
So to all of you, here's wish for great blessings during these holy days:
Happy Passover!
Happy Easter!
Before exiting the scene, a few quick comments:
First, more a question: Is the "Melt-Up" still on tap? Or has the recent turbulent drop in stock prices signalling the first vestiges of a bear market? I really don't know. On the one hand, it's hard to consider the parabolic move up in stocks as a real Melt Up. It was short and sweet. But Melt-Ups usually take a life of their own and suck in a wide swath of eager buyers dreaming of hitting the lottery by buying stocks (or other items like, let's say, bitcoin) that promise quick, "can't miss" riches. If you remember the tech wreck, "everyone" was convinced that tech companies, even though they had risen to unfathomable and unsupportable heights, were going literally to the moon. Even some famous hedge fund geniuses jumped in with both feet, and this after warning of an impending crash. The rise was simply that powerful and convincing. With that in mind, this recent rise doesn't seem or feel anything like what I could call a Melt-Up. But what do I know?
On the other hand, we're watching the Dow and the Transports closely. They've come close to a Dow bear market signal. Having hit all-time highs, they both turned down. Having turned down, they both rose again, but not to the previous highs. Having risen, they both turned down with the Dow falling below the previous low. The Transports, on the other hand, while they also fell, did not fall below their February lows - at least as of market close today. If that holds, we don't have a classic Dow Theory bear signal. Then again, a bear signal was given in 2016 - one that turned out to be unreliable. So just relying on this Dow Theory signal formula may not provide a definitive answer.
Markets are funny that way.
If we look at bonds, everyone continues to tout the end of the long bull market that began around 1980. Naturally, with more people jumping on board that bandwagon, we've had a rally in bonds. So we'll probably go into the holy days with a question mark in bonds, one that has consistently emerged each time the bond bull has threatened to die.
We'll skip any attempt at an analysis of gold, since it's a typcially weak season for that precious metal. So the recent gains falling back to earth are no surprise. We'll likely get a better idea of whether gold will or won't resume it's great bull market later in the year. That bull market begun around 2000 corrected beginning in 2011 and, while it has shown signs of strength since 2016, has never really caught fire - yet.
One thing I suggest we might all agree upon as the holy days draw nearer is this: Temper your exposure to daily news stories. It's a good general rule, but especially makes sense when days like Holy Thursday, Good Friday, Easter, and Passover are upon us. There are better ways to engage your mind, and better places to rest your heart than the typically superficial drivel that comprises most so-called "news" stories. To encourage you further in this, here's a passage - in the form of advice - I came across recently. The author was trying to encourage his reader to consider what sort of reading and study was worth their time. In the course of his discussion, he turns to "newspapers," since he was writing in 1946. (Remember: No internet, no smart phones, no personal computers, no digital anything.)
"As to newspapers, defend yourself against them with the energy that the continuity and the indiscretion of their assault make indispensable. You must know what the papers contain, but they contain so little; and it would be easy to learn it all without settling down to interminable lazy sittings!"
Yes, defend yourself! You can certainly do wtihout your "feeds" at a time when you're trying to enrich your soul with things relgious and spiritual. And if you can manage to control your appetite for useless images and verbiage during the coming holy days, maybe some of that will spill over into your life in general. Consider it. It will benefit you greatly.
So to all of you, here's wish for great blessings during these holy days:
Happy Passover!
Happy Easter!
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