On May 23, I wrote about the market forming an ominous technical pattern. The pattern I discussed was an “outside day” which is a reversal pattern. Now, days later, the stock market has traced out another reversal pattern called an “island reversal.” You can see the pattern through the link below.
In the wake of Bernanke’s testimony before Congress and the release of Federal Open Market Committee (FOMC) meeting minutes, the U. S. stock market traced an ominous technical pattern. In traditional technical analysis, this pattern is known as an “outside day.” The outside day is visible on the chart of
The stock market has been overbought for a while, and overbought markets can be vulnerable. Usually there is an excuse in the form of bad news that runs the overbought market down to alleviate the overbought condition. Monday was no exception. The bad news was that in Italy, Berlusconi garnered more votes than expected. He
The Federal Open Market Committee (FOMC) meeting minutes from January 29 -30 were released yesterday afternoon. Within the Federal Reserve System, the FOMC is responsible for making key decisions about money supply and interest rates. One paragraph in the minutes spooked gold and silver bulls, as well as stock and
Our prediction that the fiscal cliff would be resolved has turned out to be partially right. It is important not to get carried away with optimism because only one part of the three-part puzzle has been addressed. The three parts are: taxes, spending and the debt ceiling. The fiscal-cliff deal
European Central Bank Chief Mario Draghi may follow the U.S. lead and fire off his own bazooka. Requesting broader spending powers, Treasury Secretary Hank Paulson famously told Congress that he needed “a bazooka” to head off the financial crisis. German magazine Der Spiegel reports that the ECB is now considering
The markets are in a party mode and have forgotten the approaching dark cloud of the “fiscal cliff.” The fiscal cliff refers to the expiration of Bush tax cuts and simultaneous significant reduction in government spending in the United States at the end of the year. The Congressional Budget Office
Now it is universally accepted that growth in China is slowing. If a large number of communications that we receive are any indication, North American investors make two underestimations: first how much China’s growth is really slowing, and second how much it can hurt their investments in stocks, bonds and
The Federal Open Market Committee (FOMC) of the Federal Reserve System holds eight scheduled meetings in a year. The results of these meetings provide not only trading opportunities, but also extremely valuable data points for investments. The June 19 to 20 FOMC meeting is upon us. As always, there is
The two most important questions Will you lend to someone who is insolvent and has no plan to get out of insolvency at 1.47% for 10 years when inflation is running at about 3% and prospects of hyper-inflation loom? Will you sell good assets that are likely to protect your