August 16, 2022 | Daily JAM, Jubak Picks, Volatility |
If the return of the Bear Market is very likely, WHEN will it return? That’s important because the timing of the return of the Bear determines what strategy we should adopt. If the Bear will go back on the prowl very soon, say somewhere around August 24 (the date of Nvidia’s (NVDA) very important (for the tech sector and more) earnings report) and August 26 through 28, the dates of the Federal Reserve’s annual Jackson Hole confab, then you should be battening down the hatches now and selling everything you don’t want to hold through another down leg from the Bear. On the other hand, the return of the Bear could be delayed until early 2023 when it becomes clear to all the interest rate optimists on Wall Street that the Federal Reserve isn’t about to start cutting rates soon. So what do you do?
August 14, 2022 | Daily JAM |
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August 11, 2022 | Daily JAM, RUN, SGMO, Volatility |
Yesterday’s bounce on the better-than-expected July CPI inflation numbers–the annual rate dropped to 8.5% from 9.1% in June while economists surveyed by Bloomberg were expecting a drop to an 8.7% rate–looks to be fading today, August 11, but I’m going to squeeze in two more sells, Sangamo Therapeutics (SGMO) and Sunrun (RUN) for tomorrow to take advantage of this Bear Market rally. Both sells are out of my Volatility Portfolio. The high potential upside of these two picks has driven them to big gains in the Bear Market rally that began in July. That same volatility, on the downside, makes them stocks I don’t want to hold in any return of the Bear Market.
August 11, 2022 | Daily JAM, Morning Briefing |
It didn’t take long. The pixels were barely dry on yesterday’s CPI inflation report–headline inflation fell to a year-over-year rate of 8.5% in July from 9.1% in June–before members of the Federal Reserve warned that the stock market rally on the news was based on a misreading of the Fed’s likely reaction to the lower CPI inflation rate.
August 10, 2022 | AMD, Daily JAM, DAL, Jubak Picks, MLM |
Despite today’s CPI inflation bounce and the continuation (flagging but still in business) of July’s Bear Market rally, my goal is still to sell into rallies. I don’t think this Bear Market is over and done with. I see another down leg when investors and traders admit that the Federal Reserve isn’t going to be able to get inflation under control with just another 100 basis points of interest rate increases (and, the other part of this hopeful scenario, to begin cutting interest rates by the middle of 2023.) So I’ll be making three sells today out of my Jubak Picks Portfolio to take advantage of the CPI bounce.
August 1, 2022 | Daily JAM, Videos |
My one-hundred-and-sixty-second YouTube video “Earnings Not as Bad as They Could Be” went up today. Microsoft (MSFT) serves as my example. We’re seeing some companies that, despite very meager earnings growth, give investors the impression that things “are not as bad as they could be.” These stocks will see bumps after upcoming earnings reports. Is this a long-term trend? Is it enough to keep the Bear Market rally going? Not necessarily. But it supports stocks for now.
July 31, 2022 | Daily JAM, Friday Trick or Trend |
The yield on the 10-year Treasury has dropped a whopping 36 basis points in the last month to just 2.65%.
That’s either a strong vote that the economy is about to move into a deeper recession or that the Federal Reserve won’t raise interest rates by as much as had been anticipated earlier in the year. Or maybe a vote for both. But that drop in yield (with a rise in Treasury prices) has certainly added a bit of fuel to the current Bear Market rally. And if you’re trying to figure out how long that rally might last, I suggest you add the direction of Treasury yields to your list of indicators to watch.
July 30, 2022 | Daily JAM |
I’m looking for a big test of July’s Bear Market rally. In July the Standard & Poor’s 500 gained 9.1%. The index went up 4.3% in the last week alone. The obvious question is how much longer does this rally have to run? The big test comes on Friday, August 5, with the jobs report for July.
July 28, 2022 | Daily JAM, Morning Briefing, Top 50 Stocks |
After looking like it was over earlier in the week with a significant pull back on Tuesday, July 26, stocks have rallied in the last two days, gaining 3.85% by the Thursday, July 28 close from that Tuesday low. And right now all the ducks are lined up in a row for a strong move higher. (But you know what they say about Bear Market rallies right? They’re really hard to trade and they’re even harder to sell into.)
Those ducks?
June 19, 2022 | CHPT, Daily JAM, EVGO, Volatility |
Friday, June 17, was a modestly up day for most of the indexes. The Standard & Poor’s 500, for example, gained 0.22% and the NASDAQ was up a stronger 1.43%. (The Dow Jones Industrial Average lost 0.13% on the day.) But you’d never know that the indexes were up only modestly if you checked the gains on the most speculative stocks in the market. Meme favorites GameStop (GME) and AMC Entertainment (AMC) were up 7.48% and 6.28%, respectively. But the speculative gains didn’t stop there.
June 16, 2022 | Daily JAM, Jubak Picks, Morning Briefing, Volatility |
Yesterday, the stock market was up with the Standard & Poor’s 500 gaining 1.46% on the day and the NASDAQ Composite up 2.49%. Listening to the Federal Reserve’s policy statement after the June 15 meeting of its Open Market Committee, Wall Street chose to hear a promise of interest rate cuts as early as the end of 2023 and certainly in 2023. Aggressive interest rate increases in 2022, from this perspective, are just a necessary precondition to those interest rate cuts. Today, the stock market is down with the Standard & Poor’s 500 falling 3.25% and the NASDAQ Composite off 4.08% at the close. The narrative on investors’ and traders’ minds today is the rising odds of a recession–75% odds in favor by 2024 a Bloomberg survey of economists says with 25% odds of a recession in 2023. For a day that trumps the hopes for 2024 interest rate cuts (which would, after all, only materialize if the economy has, indeed, tumbled into recession. I expect this “War of the Two Narratives” to continue for a while
June 14, 2022 | Daily JAM |
Stocks have spent two days in a vigorous sell off because of fears of higher interest rates and worries, after Friday’s surprise surge in CPI inflation to an 8.6% annual rate in May, that the Fed might decide to raise interest rates by 75 bass points rather than the expected 50 basis points at the Wednesday, June 15, meeting of its Open Market Committee. And now the actual 75 basis-point increase might produce a rally? Where’s the logic in that? The odds of a rally on a 75 basis point increase (and mind you, I still think 50 basis points is much more likely) rest on this emerging Wall Street narrative.
