Momentrix's Instablog Tactical Investing in the 21st Century. The FMAM Team is composed of seasoned Wall Street professionals with combined active experience on the buy side and the sell side of the Street. Together, we have worked as RIA's, managed BD's, banks, and mutual funds as well as proprietary trading desks. We believe that in today's markets, diversification leads to mediocrity and that timing is everything in the new normal of the 21st century. Our goal is to do the "heavy lifting" for you by using our proprietary strategy to bring fresh ideas based on the underlying fundamentals of the stocks we analyze combined with the disciplined element of timing the optimum points of entry and points of exit for each of our stock picks. Momentrix http://seekingalpha.com Earthquake forces Goldman to evacuate.... http://seekingalpha.com/instablog/875659-momentrix/210112-earthquake-forces-goldman-to-evacuate?source=feed 210112 Employees of Goldman Sachs departing the swaying building...]]> Wed, 24 Aug 2011 13:47:00 -0400 Employees of Goldman Sachs departing the swaying building...]]> Goldman Sachs The Momentrix View of the Markets for Tuesday August 23, 2011 http://seekingalpha.com/instablog/875659-momentrix/209648-the-momentrix-view-of-the-markets-for-tuesday-august-23-2011?source=feed 209648
Tuesday August 23, 2011- Wall Street experienced a huge “trend up” rally today, the S&P 500 closing up 3.4%. Although we do not think the worst is over, we respect the market move and out of discipline we removed our hedges. Our cash levels remain high in the model portfolio. The fact the market moved higher on a day when the CDS spreads were moving higher on both American Banks and in Europe is a major positive. It will be interesting to see in the coming days if these spreads reverse course. The major breakdown in gold, a move lower in the TLT and the Swissy (FXF) all do point to a lessening of the stress in the system.
We finally saw the model portfolio stocks come alive, perhaps a sign of a more normalized market.  Leadership stocks are acting much better on the day as a return to fundamentals may be starting. The caveat is that the market is oversold and most stocks are extremely beaten down so a good day like this can lead to easy gains. Generally a time of extreme volatility like we have been through will not end with a day like today.  We will now watch for a classic O’neil “follow through” day before adding exposure. The bulls are embracing the technical hold of the latest lows amidst the failed rallies of the last couple of days. The market remains erratic and dangerous except for the most disciplined traders. It should be noted that the sharpest rallies do occur in bear markets and today’s move alone does not remove this possibility.
 
]]> Tue, 23 Aug 2011 16:25:22 -0400
Tuesday August 23, 2011- Wall Street experienced a huge “trend up” rally today, the S&P 500 closing up 3.4%. Although we do not think the worst is over, we respect the market move and out of discipline we removed our hedges. Our cash levels remain high in the model portfolio. The fact the market moved higher on a day when the CDS spreads were moving higher on both American Banks and in Europe is a major positive. It will be interesting to see in the coming days if these spreads reverse course. The major breakdown in gold, a move lower in the TLT and the Swissy (FXF) all do point to a lessening of the stress in the system.
We finally saw the model portfolio stocks come alive, perhaps a sign of a more normalized market.  Leadership stocks are acting much better on the day as a return to fundamentals may be starting. The caveat is that the market is oversold and most stocks are extremely beaten down so a good day like this can lead to easy gains. Generally a time of extreme volatility like we have been through will not end with a day like today.  We will now watch for a classic O’neil “follow through” day before adding exposure. The bulls are embracing the technical hold of the latest lows amidst the failed rallies of the last couple of days. The market remains erratic and dangerous except for the most disciplined traders. It should be noted that the sharpest rallies do occur in bear markets and today’s move alone does not remove this possibility.
 
]]> fxf tlt The Momentrix View of the Markets for Monday August 22, 2011 http://seekingalpha.com/instablog/875659-momentrix/209460-the-momentrix-view-of-the-markets-for-monday-august-22-2011?source=feed 209460
Monday August 22, 2011- The volatility continued on the street today. As the futures opened last night, the Libyan news hit the wires and the market yawned at the prospects of an end to the turmoil. Overnight the futures picked up steam as Europe opened and continued the momentum into the U.S. open, up as much as 200 points on the Dow futures. After a strong open, the market entered a basic trend down day, finishing at or near the lows, financials and energy being the worst performing groups on the day. The S&P 500 finished basically flat and the NASDAQ closed up 0.1%.
We see this day as more evidence that we are no longer in a bull market. Failed rallies are a trade mark of bear markets and todays move adds another to a long list in recent weeks. The surge in gold, which has gone parabolic, is more evidence of stress in the system. Generally parabolic moves end badly for those that enter the game late and this time will likely be no different. The only events that could support this action would be a collapse of a major currency or a return to the gold standard, both of which could be on the table.
Obviously the market is too erratic right now to warrant being fully invested. We remain on the defensive.
 
]]> Tue, 23 Aug 2011 09:38:38 -0400
Monday August 22, 2011- The volatility continued on the street today. As the futures opened last night, the Libyan news hit the wires and the market yawned at the prospects of an end to the turmoil. Overnight the futures picked up steam as Europe opened and continued the momentum into the U.S. open, up as much as 200 points on the Dow futures. After a strong open, the market entered a basic trend down day, finishing at or near the lows, financials and energy being the worst performing groups on the day. The S&P 500 finished basically flat and the NASDAQ closed up 0.1%.
We see this day as more evidence that we are no longer in a bull market. Failed rallies are a trade mark of bear markets and todays move adds another to a long list in recent weeks. The surge in gold, which has gone parabolic, is more evidence of stress in the system. Generally parabolic moves end badly for those that enter the game late and this time will likely be no different. The only events that could support this action would be a collapse of a major currency or a return to the gold standard, both of which could be on the table.
Obviously the market is too erratic right now to warrant being fully invested. We remain on the defensive.
 
]]> The Momentrix View of the Markets http://seekingalpha.com/instablog/875659-momentrix/206667-the-momentrix-view-of-the-markets?source=feed 206667 Tuesday August 16, 2011- The market seems to be searching for a direction. The recent rally has been encouraging, but we continue to see it as just a retracement of the recent oversold state. For the rally to continue, the bulls are going to have to work much harder to push the tape higher as the easy points have been made. The S&P 500 has been able to hold its close above its 10 moving average of yesterday. As time goes on with price in this area, the average will first flatten then eventually turn to the upside, potentially helping support the market (if you believe in the validity of technical analysis).
On the day the S&P 500 lost 11 points or 1.0%, volume slightly higher than yesterday. Many market participants are encouraged by the move off the lows. We are less enthusiastic as we have concern of a grinding slow rollover lulling the bulls to sleep.
Our “Trifecta Indicator” showed 2 out of 3 in the green today, signaling moderate stress. The outlier was the FXF, closing down about 1%. Recently there have been rumors about the Swiss Franc being linked to the Euro potentially removing some effectiveness of the ETF as an indicator. We may have to revise the Trifecta Indicator in the coming days; we want to see how the FXF acts for a while longer prior to removing or replacing it.
On the economic front, the capacity utilization and industrial production numbers were better than expected. Many economists are expecting the economy to continue to slow and these data are contrary to this thinking. The GDP numbers out of Europe show a much quicker slow down than previously perceived. There appears to be a divergence between Europe and the U.S. developing and bears watching in the coming months.
The Momentrix Model portfolio remains in significant cash. We are concerned about the slowing economy, Europe, and the potential that earnings estimates are too high. The rally in the last few days was very sharp; many times the sharpest rallies occur in bear markets. We do not know if this is the case but it is not out of the realm of possibility. Until we have a better feel for what kind of market we are in, we will remain in higher than usual cash.
 
]]> Tue, 16 Aug 2011 17:08:30 -0400 Tuesday August 16, 2011- The market seems to be searching for a direction. The recent rally has been encouraging, but we continue to see it as just a retracement of the recent oversold state. For the rally to continue, the bulls are going to have to work much harder to push the tape higher as the easy points have been made. The S&P 500 has been able to hold its close above its 10 moving average of yesterday. As time goes on with price in this area, the average will first flatten then eventually turn to the upside, potentially helping support the market (if you believe in the validity of technical analysis).
On the day the S&P 500 lost 11 points or 1.0%, volume slightly higher than yesterday. Many market participants are encouraged by the move off the lows. We are less enthusiastic as we have concern of a grinding slow rollover lulling the bulls to sleep.
Our “Trifecta Indicator” showed 2 out of 3 in the green today, signaling moderate stress. The outlier was the FXF, closing down about 1%. Recently there have been rumors about the Swiss Franc being linked to the Euro potentially removing some effectiveness of the ETF as an indicator. We may have to revise the Trifecta Indicator in the coming days; we want to see how the FXF acts for a while longer prior to removing or replacing it.
On the economic front, the capacity utilization and industrial production numbers were better than expected. Many economists are expecting the economy to continue to slow and these data are contrary to this thinking. The GDP numbers out of Europe show a much quicker slow down than previously perceived. There appears to be a divergence between Europe and the U.S. developing and bears watching in the coming months.
The Momentrix Model portfolio remains in significant cash. We are concerned about the slowing economy, Europe, and the potential that earnings estimates are too high. The rally in the last few days was very sharp; many times the sharpest rallies occur in bear markets. We do not know if this is the case but it is not out of the realm of possibility. Until we have a better feel for what kind of market we are in, we will remain in higher than usual cash.
 
]]> Fundamental Momentum The Momentrix View of the Markets for August 15, 2011 http://seekingalpha.com/instablog/875659-momentrix/206116-the-momentrix-view-of-the-markets-for-august-15-2011?source=feed 206116
Monday August 15, 2011- The market staged another rally, its third in a row, the S&P 500 finishing the day up 2.20%. On the positive side, financials were among the market leaders today, an encouraging sign as this group was the worst performer during the sell-off. On the negative side, the GLD (gold etf) rallied steadily today, a sign that some currency stress remains in the system.
The S&P 500 closed above its 10 day moving average, the first time since the correction began. The last time the S&P closed above this average was on July 26. Although this is also encouraging, the trend of the 10 day moving average is so steep to the downside that it will likely be difficult for this to hold over the short term. We generally like to see moving average trends to be in the same direction as price. It just takes time to change directions. We still hold high levels of cash and may initiate some hedges should our stress indicators start to rally.
 
]]> Mon, 15 Aug 2011 18:12:38 -0400
Monday August 15, 2011- The market staged another rally, its third in a row, the S&P 500 finishing the day up 2.20%. On the positive side, financials were among the market leaders today, an encouraging sign as this group was the worst performer during the sell-off. On the negative side, the GLD (gold etf) rallied steadily today, a sign that some currency stress remains in the system.
The S&P 500 closed above its 10 day moving average, the first time since the correction began. The last time the S&P closed above this average was on July 26. Although this is also encouraging, the trend of the 10 day moving average is so steep to the downside that it will likely be difficult for this to hold over the short term. We generally like to see moving average trends to be in the same direction as price. It just takes time to change directions. We still hold high levels of cash and may initiate some hedges should our stress indicators start to rally.
 
]]> The Momentrix View of the Markets for Wednesday August 10, 2011- http://seekingalpha.com/instablog/875659-momentrix/204126-the-momentrix-view-of-the-markets-for-wednesday-august-10-2011?source=feed 204126
 The market took away all of the gains from yesterday, the S&P closing down 4.6% and the NASDAQ down 4.0%. Europe was front and center once again today as many French banks were under pressure similar to the U.S. banks back in 2008. The instability in the market makes this a very difficult environment to invest in to say the least.
Although we are not calling a bottom, as that is a futile game, we did remove our hedge in the market and brought our long exposure back to 60% long with 40% cash. Judging by the finish of the day, it is highly likely that tomorrow will have an ugly start. It is still possible that the market has an all-out crash but at these levels we feel the risk reward is starting to tilt toward the upside as a significant amount of the economic slowdown has been discounted. The problem remains that we have not discounted a crash in the U.S. Dollar or a breakup of the Eurozone. The worst case would be both events occurring simultaneously.
The bottom-line is that it will take time for the market to work out its equilibrium and lower the volatility. We like the risk reward although we will not dig our feet in if it becomes apparent that we are wrong. Discipline and exiting trades is the key to investment success over the long run. We intend to follow this course with our moves in the coming days.
 
See MomentrixInvesting.com for further information and sign up for our beta for the Momentrix RT3 Trader's Toolbox app for All the Markets. All the Time.
Also visit Momentrixreport.com for All the News. All the Time....
]]> Wed, 10 Aug 2011 17:04:11 -0400
 The market took away all of the gains from yesterday, the S&P closing down 4.6% and the NASDAQ down 4.0%. Europe was front and center once again today as many French banks were under pressure similar to the U.S. banks back in 2008. The instability in the market makes this a very difficult environment to invest in to say the least.
Although we are not calling a bottom, as that is a futile game, we did remove our hedge in the market and brought our long exposure back to 60% long with 40% cash. Judging by the finish of the day, it is highly likely that tomorrow will have an ugly start. It is still possible that the market has an all-out crash but at these levels we feel the risk reward is starting to tilt toward the upside as a significant amount of the economic slowdown has been discounted. The problem remains that we have not discounted a crash in the U.S. Dollar or a breakup of the Eurozone. The worst case would be both events occurring simultaneously.
The bottom-line is that it will take time for the market to work out its equilibrium and lower the volatility. We like the risk reward although we will not dig our feet in if it becomes apparent that we are wrong. Discipline and exiting trades is the key to investment success over the long run. We intend to follow this course with our moves in the coming days.
 
See MomentrixInvesting.com for further information and sign up for our beta for the Momentrix RT3 Trader's Toolbox app for All the Markets. All the Time.
Also visit Momentrixreport.com for All the News. All the Time....
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