Thread: WorkFE's Account Talk

Took a break from all the economic nonsense for the past 10 days.

Dad turned 80 last week so my wife and I took some time off and a drove up to PA to spend a bit of quality time with the family.
Took the long way home through some of the Northern counties. Always a good way to reset the batteries for the new year.

The Fed is starting to field calls from all over about easing up on rate hikes. Quarterly earnings are mixed but, due to expectations being low, a majority are exceeding estimates.
I expect the volatility to continue up and down through the new year but then to flatten out as we see some light on Fed Policy relaxation and some of the currencies around the world find some footing. Would be nice to know what the ceiling on interests rates will be. It would be nice to know we are not revisiting 1981.

Markets looking good today. Stay away from the ledge.

It’s not all Doom and Gloom.
“A Democratic president with a Republican Congress is the best setup that appears over the last 90 years,” says Patrick Nielsen, deputy general manager of MAPFRE AM.

Historically, midterm elections set up nice rallies with phenomenal consistency. Since 1942, after midterm elections the S&P 500 went up 7.6%, 14.1%, and 14.9% over the next three, six and 12 months, notes Ed Yardeni of Yardeni Research.

The period of November to January is seasonally strong for the market. Since 1936, the S&P 500 has advanced 4.5% vs. an overall average three-month performance of 2.9%, the quantitative analysts at Bank of America tell us.

It’s usually better to buy when things look bleak, not when everything is rosy. Gotta put down the bourbon, starting to sound like Birchtree.

Originally Posted by WorkFE

It’s not all Doom and Gloom.
“Historically, midterm elections set up nice rallies with phenomenal consistency. Since 1942, after midterm elections the S&P 500 went up 7.6%, 14.1%, and 14.9% over the next three, six and 12 months, notes Ed Yardeni of Yardeni Research.

Looks like they are trying to get all of those gains in one day. What a pop off the blocks - see if it holds to the end of the day.

There are days when you see the market shoot off like a rocket and think “If this is a Bear Market, I’ll take more of that”.

The last few days may have been a bit overdone by Investors and I’m certain that much of what I have read could be taken as tongue and cheek, but I must remind myself that the DOW, S&P and NASDAQ are still down 3K, 800 and 4K respectively from their highs.

Profits are profits and always better than losses but don’t forget that those profits will get smacked around a bit with higher interest’s rates. This inflation is proving to be somewhat persistent; I don’t see the FED backing off anytime soon.

Analyst Tom Essaye (Sevens Report) "Real bear market bottoms are formed on the back of investor capitulation and panic, something we have not yet seen with the market this year."

So, do you anticipate some pullback this week moving forward?? I would think that this (rally) was a euphoric knee jerk reaction to the 7.7 CPI, which was only .3 below the estimated 8.0.
That was a huge gap up that will have to be filled, plus individual parts of the big picture are still out of control.
Such as:

mm1.jpg
mm2.jpg . . . . .

If I had to make a guess, which is all it is, big ups and downs will be the norm for a while. Playing it is risky, but it can be done.

WMT on fire this morning.

Did I mention that playing this market is risky.
Roller-coaster Tuesday.

Bad news, Inflation isn't going anywhere. Recession followed by rising unemployment.

Good news, lots of stocks in different sectors put in lows months ago and quite honestly have recovered quite nicely.

Unknown news, know idea how long before we fully recover our highs and see our next leg up. But I do see some silver lining.
My guess is 4th Quater 2023.

The market is open on Friday, but it is a short day.