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Dead Cat Bounce

Hello MarketClub members everywhere. I am sticking out my neck today and calling today's overnight rally a "dead cat bounce." This type of rally is not a reversal, it is more of a correction for a very oversold condition in the equity markets.

If we have any cat lovers out there my apologies go to you, but I have to admit I do love the expression "dead cat bounce." I'm not sure where the expression came from, but it seems to fit the markets perfectly.

MarketClub's Mid-day Market Report

Indices & Stocks: Make no mistake about it, the dramatic Brexit slide in the markets worldwide has had a profound effect both technically and psychologically on the markets. The major indices and many stocks appear to have put in tops that are capable of moving to some of the Fibonacci levels I outlined in yesterday's video. [Read more...]

The Big Reset

Hello MarketClub members everywhere. Well, we had the weekend to ponder and recalibrate our thinking towards Great Britain's historic exit from the EU and its effect on world markets.

Personally, I congratulate the British for having the chutzpah to go against conventional thinking. It is not like England is some third world power, they have the 5th largest economy in the world and provide 50% of the EU's military power. History will prove whether or not the Brits got it right by exiting the EU. My gut feeling is any time you can do without faceless bureaucrats running things, you are better off. I'm hard-pressed to point out any outstanding achievements generated by any bureaucracy. Nor can I point to any example of when a bureaucracy has admitted or taken responsibility for major screw-ups. So, I think Great Britain is better off without Brussels and their faceless bureaucracy.

Where does that leave the markets?

MarketClub's Mid-day Market Report

Here is what I am thinking and it is based purely on market reaction. After Friday's 610.4 drop in the DOW, I would not be in a rush to buy stocks. Make no mistake about it, the 3.39% drop was and is a big deal. [Read more...]

See EU Later - Brexit is for Real

Hello MarketClub members everywhere! The votes are counted and almost everyone got this one wrong, including the British betting shops. It's official - England is leaving the EU after 43 years.

I guess I was in the right camp when I posted this on June 14th.

The early reaction was the British Pound falling to its lowest levels since 1985 and stock markets around the world crashing. The one bright spot was the rush into gold which once again shot up over the $1300 level and seems poised to move to the $1400 level.

MarketClub's Mid-day Market Report

Indices: Looking at the major indices here in the U.S. this morning they are all going to be sharply lower and under pressure. [Read more...]

Welcome To What I'm Calling H*ll Week

Hello MarketClub members everywhere! Yesterday, we saw the news push the equity markets sharply higher. Unfortunately, the enthusiasm did not last the entire day and the markets fell off quite dramatically from the early highs. As I have been saying for some time, the markets are in a broad trading range and Brexit is just adding fuel to the type of range trading mentality.

MarketClub's Mid-day Market Report

I was interviewed by Reuters yesterday and they asked me what I thought of the markets and Brexit. I answered them in the only way that I could, saying that no one at this juncture has a clue as to whether England is going to remain in the EU or it's going to leave. There are of course pros and cons for both sides of this argument.

The younger generation wants to stay in the EU as it gives them more latitude to move to other countries and find work. The older generation wants to leave and get out from under the thumb of the bureaucrats in Brussels and also have Britain set its own immigration policies.

Like I said earlier, it's going to be a volatile week and polls are more likely going to drive the sentiment than common sense.

This comment just came in from a MarketClub member: [Read more...]

All Eyes On Brexit

Hello MarketClub members everywhere!

Make no mistake about it; the markets will all be obsessing about whether or not Great Britain will stay or leave the EU.

MarketClub's Mid-day Market Report

This morning all the markets are thinking happy thoughts and are rising as they think that Britain is going to stay in the EU.

The bottom line is no one has a clue if Great Britain will stay or leave the EU. The other crazy thing is no one has a clue as to what will happen if Great Britain leaves. As you can see, there is no clear cut path or idea as to what's ahead.

So here is what to do - I call it the "Desert Island" approach to trading. Let's say you were trapped on a desert island with plenty of food and water but with no news of any kind. The only news you could receive is stock and futures prices - could you trade on just that information? Before I answer that question, ask yourself this question, if you were looking back at a stock chart and back testing would you be looking at the news? The answer is probably not, you would be looking at price action and that is exactly what the market proven Trade Triangle's do every day.

The bottom line is price action make market trends.

One caveat - Black Swan Events [Read more...]

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