"You know what made yesterday so much fun? For a brief window of opportunity we were able to envision a lot of green shoots globally and talk in the context of a whole set of crystal champagne flutes half-full. Which central bank might be the next one to surprise with a hawkish spin was actually a topic. Speculation, idle or not, on widespread retractions of liquidity was good news, not of that soul-crushing bad news is good news variety."
Authored by Lance Roberts via RealInvestmentAdvice.com,
In this past weekend’s newsletter, I discussed the relatively “weak” breakout of the market to new record highs. To wit:
Authored by Peter Tchir via Brean Capital,
Momentum Trader: It’s going to zero!
Sales: Protection is worthless. Why pay up for protection, it always turns out worthless?
Quant Trader: The skew and relative steepness makes timing critical on any purchase. The theta decay is virtually impossible to overcome.
Desk Head: Why aren’t we selling more?
The market is rising… or is it?
The number of individual S&P 500 companies above their 200-day moving averages (200-DMA) has rolled over.
Put simply, the broader market is NOT confirming this move in stocks.
So overall the momentum is leaving the market... but still the stock market index is going higher...
Why is this?
Because the market is being propped up by just a handful of Tech Companies.
Those companies are: Apple, Amazon, Microsoft, and Alphabet.
From Nicholas Colas of Convergex
Today we continue our recent exploration of the ongoing low volatility in US equity markets, but with a novel twist. Instead of looking at the CBOE VIX Index, we look at the historical trends in actual S&P 500 price volatility. Not only is the dataset longer here (starting in the 1950s rather than 1990), but it is also “Stickier” than the twitchy VIX.
Three takeaways.