Tag Archives: divergence

Troubling Divergence Between Stock and Commodity Prices

Posted on July 27, 2015 by

It is logical to expect that commodity prices and equity prices are causally linked. It is simply a question of supply and demand. In an expanding economy, demand for commodities should increase and in a contracting economy, demand should decrease. … Continue reading →

Share
Posted in Article Links - External, Fundamental Analysis, Market Timing, Technical Analysis | Tagged , , | 1 Comment

Market Breadth Divergence Update

Posted on November 27, 2013 by

On Sunday November 17th, I posted an article that identified headwinds for the equity market.  I explained that five independent leading indicators all pointed to near-term trouble for equities: a forming divergence in market breadth, an elevated CBOE Skew Index, … Continue reading →

Share
Posted in Economic Indicators, Market Breadth, Market Commentary, Market Sentiment, Market Timing, Trade Analysis | Tagged , , , , , , , , , , , , , , | Leave a comment

Five Headwinds for Equities

Posted on November 17, 2013 by

I typically release new posts on Thursdays, but market conditions justified an accelerated schedule this week. Five independent leading indicators all point to near-term trouble for equities: a forming divergence in market breadth, an elevated CBOE Skew Index, a very … Continue reading →

Share
Posted in Economic Indicators, Fundamental Analysis, In-Depth Article, Market Breadth, Market Commentary, Market Sentiment, Market Timing, Technical Analysis | Tagged , , , , , , , , , , , , , , | 2 Comments

The Deadly Double Divergence

Posted on October 24, 2013 by

Would you be interested in an indicator that has signaled ten market tops since 1966 without a single false signal?  I read about such an indicator in an article titled “Double Divergences in the Advance-Decline Line,” which appeared in the … Continue reading →

Share
Posted in In-Depth Article, Market Breadth, Market Commentary, Market Timing, Technical Analysis | Tagged , , , , , , , , , , | 2 Comments

Q3 2012 Earnings Preview

Posted on October 9, 2012 by

With the daily deluge of new data, it is easy to lose the forest for the trees.  When in doubt, focus on earnings, the ultimate driver of stock prices.  If I could choose one statistic to know in advance, it … Continue reading →

Share
Posted in COT Analysis, Economic Indicators, Fundamental Analysis, Market Commentary, Market Timing | Tagged , , , , , , , , , , | 2 Comments

Prices and Earnings Diverge

Posted on July 29, 2012 by

According to FactSet, since June 1, the price of the S&P 500 index has increased by 6.4%, while the year-over-year earnings growth rate for Q3 has declined from +3.5% to -1.6%.  In other words, while analysts were reducing their earnings … Continue reading →

Share
Posted in Economic Indicators, Fundamental Analysis, Market Commentary, Market Timing | Tagged , , , , , , , , , | Leave a comment

Market Diverges From Economic Data

Posted on June 25, 2012 by

Economic releases were mixed last week.  Building permits came in stronger than expected, but are still at anemic levels.  Leading indicators were up 0.3% last month, which was also stronger than expected. Unfortunately, the ECRI weekly leading indicator (WLI) declined … Continue reading →

Share
Posted in Market Commentary, Market Timing, Summary Market Indicator Score | Tagged , , , , , , , , , | Leave a comment

Use Relative Strength to Identify Market Trends

Posted on June 8, 2012 by

Relative strength rotational strategies have a proven track record of success, but the potential uses of relative strength extend much further than security selection.  One of my favorite techniques is to use the relative strength of two different indices, futures … Continue reading →

Share
Posted in Economic Indicators, Futures, In-Depth Article, Market Breadth, Market Commentary, Market Timing, Relative Strength, Technical Analysis | Tagged , , , , , , , , | 3 Comments