Stock Market Analysis: 01/21/11
Nevertheless, problems remain and all Draghi & Company has done is bought time for the politicians to address the long term issues. We will have to watch and see how the politicians address the longer term problems of the competitiveness disparity between North and South, as well as the debt situation of the PIIGS. I wrote on December 13 to watch for the China is slowing stories to emerge (see A "China is slowing" scare?). One important component of this approach is to watch momentum indicators carefully. From a macro viewpoint, the three regions to watch are Europe, the US and China and the emerging markets. This time, the macro backdrop is different. In addition, coordinated central bank intervention that offered unlimited USD liquidity also showed that central bankers around the world are well aware of the risks of a Lehman/Creditanstalt credit event and have taken steps to address the problem.
Of course, this has had several implications for the world in general, especially when it comes to businesses. The bitter truth is no one in the world can perfectly predict share market movement. Other regular subterranean insect impediments which you can spread around are grounds from espresso, and mint tea or you can splash with garlic or lemon blended with water. I wrote here that the the boutique indices in India and China are not behaving well. Why India is riskier than China. This is why these moving averages are so key. So why the rationale for selling? This post from Pragmatic Capital shows that the US was in recession 18.3% of the time in the 2000-2011 period and a whopping 30% of the time if you consider the 1855-2011 time span. A staggering growth of 910% is recorded over the period of 6 years and 9 months on a sum invested by a trader. One thing that investors shouldn't forget that stock prices depend on fundamentals, i.e. earnings, growth outlook, interest rates, etc. An American recession would affect the outlook for earnings and therefore depress stock prices as a result.
I believe that the biggest risk for the stock markets is a rising level of risk aversion as investors price in the increasing likelihood of a slowing growth from the emerging market economies. Below is a list of stocks that are worth watching for November 15, 2010. Also, check out some of the biggest stock gainers of the Day, Top 2010 stock Gainers , Hot stock Market News, and Day Trading Tips. I am watching the following financials for trading opportunites. Since all the performance of the stock is stored in one place,iTrend, the best trend following system makes it easy for the traders to compare and contrast every portfolio before investing into any one. I have participated in the following scrip dividend scheme this month - Noble Group. These stocks often have several more breakouts during the year and make multi month or multi year moves. If you do employ this strategy, you should buy a basket of these stocks and not focus on just one or two names.
Full disclosure: I am personally long ATPG and SVNT and may seek to get long the other names mentioned in the days to come. ATP Oil & Gas Corp/United States (ATPG), Coldwater Creek Inc (CWTR), Gentiva Health Services Inc (GTIV), MEMC Electronic Materials Inc (WFR), Savient Pharmaceuticals Inc (SVNT), SIGA Technologies Inc (SIGA), Sun Healthcare Group Inc (SUNH) and Willbros Group Inc (WG). Commodity prices remain in a downtrend, which is a signal of slowing global demand for raw materials. As soon as momentum wanes, that will be the exit signal. Netflix, Inc. (NFLX) - Netflix, Inc. (NFLX) was dumped Thursday due to money coming out of the momentum stocks right now. Lastly, this is a momentum dependent strategy that should be rented and not owned. Since the market rally has been going on for several months, buying into a Phoenix strategy now is being late in the game. Daily Finan. Bull 3X Shs(ETF)(FAS) - FAS dropped again Tuesday as the financials pulled back after a nice rally. As 2011 draws to a close and we 2012 dawns, it's time to consider the bull and bear cases for the stock market and risky assets. A US recession in 2012?
















