How Low Can This Market Go? The 40 Percent Solution [View article]
I think that earnings disappointments will contribute to further stock market declines. Expectation of an economic "slowdown" is slowly being replaced by a serious downturn. One implication is that earnings estimates will come down significantly. The market will adjust accordingly. I used estimates for next week's reports and the charts clearly indicate that 1995 was a walk in the park compared to current conditions. See wrahal.blogspot.com/20...
Can Earnings Season Be the Market's Savior? [View article]
The downward adjustment in stock prices are a result of expectations being lowered by investors. Next week's reports (using consensus estimates) show no improvement for the the sluggish environment we are in.
The Advancing minus Declining Volume line has also broken to new lows. This does not bode well for the stock market, and confirms that my economic indicators pointing to a recession are valid. Despite the tax rebate the ratio of ND/Durable Goods consumption keeps rising, allowing for less discretionary spending needed to stimulate the economy
S&P 500 50-Day High/Low Spread Hits 5-Year High [View article]
Note that your 50-day Hi/Low spread tends to point to excess pessimism and therefore (relative) bottoms. I am betting on a short term bottom for Tuesday(1/22) as my indicators are in "buy mode' and providing positive divergence with respect to the S&P price action.
Consensus Economist Estimates Don't Suggest a Recession [View article]
A slowdond like 1995? I Don't think so. Retail Sales will be reported tomorrow. I deflated RS by the CPI and this Real RS is trending lower and is below the 1995 level.
High Interest rates are suffocating the economy already.
In the last three decades when the last(quarterly average) rise in interest rates takes place and Nominal GDP year-over-year growth starts to decelerate , the Fed has cut rates in within one quarter of this event, every time except for 1998.
This time around we are in the fourth quarter of declining Nominal GDP growth.
By this measure, Mr. Bernanke is already late!
The lower US Dollar, high CPI rate and the Chairman’s reputation, prevent the Fed from lowering rates.
How Low Can This Market Go? The 40 Percent Solution [View article]
I used estimates for next week's reports and the charts clearly indicate that 1995 was a walk in the park compared to current conditions.
See
wrahal.blogspot.com/20...
Can Earnings Season Be the Market's Savior? [View article]
Next week's reports (using consensus estimates) show no improvement for the the sluggish environment we are in.
Market Breadth Back to Lows [View article]
This does not bode well for the stock market, and confirms that my economic indicators pointing to a recession are valid.
Despite the tax rebate the ratio of ND/Durable Goods consumption keeps rising, allowing for less discretionary spending needed to stimulate the economy
See
wrahal.blogspot.com/20...
S&P 500 50-Day High/Low Spread Hits 5-Year High [View article]
I am betting on a short term bottom for Tuesday(1/22) as my indicators are in "buy mode' and providing positive divergence with respect to the S&P price action.
Consensus Economist Estimates Don't Suggest a Recession [View article]
I Don't think so.
Retail Sales will be reported tomorrow.
I deflated RS by the CPI and this Real RS is trending lower
and is below the 1995 level.
The Fed's Done All It Can For Now [View article]
In the last three decades when the last(quarterly average) rise in interest rates takes place
and Nominal GDP year-over-year growth starts to decelerate , the Fed has
cut rates in within one quarter of this event, every time except for 1998.
This time around we are in the fourth quarter of declining Nominal GDP growth.
By this measure, Mr. Bernanke is already late!
The lower US Dollar, high CPI rate and the Chairman’s reputation, prevent
the Fed from lowering rates.