Geopolitics - Sell The Rumor, Buy The News?

Posted on by Noah Kiedrowski

Relentless Selling

The old adage is buying the rumor and selling on the news; however, during this recent market correction, it's been the opposite. Selling the rumor and buying the news has prevailed when it comes to interest rate hikes and the geopolitical tensions between Russia and Ukraine. In both cases, the anticipation of rate hikes has sent the market into a downward tailspin despite the fact the Federal Reserve hasn't put forth any rate hikes. In addition, the anticipation of the Russian/Ukraine conflict boiling over into an invasion by Russia drove the markets further into correction territory.

As a result, the markets entered deep into correction territory. Over a third of the Nasdaq 100 stocks traded off at least 30% or more from their highs, over half of the S&P 500 fell 15% or more while the median biotech stock had sold off by 60% or more. In addition, massive amounts of market capitalization have been eviscerated across the board, with many individual stocks selling off 50% or more throughout this downward spiral.

Per Tom Lee, many factors, including the market's big reversal at the onset of Russia's invasion of Ukraine, indicate the markets are now bottoming around these levels. Lee stated that the market's stunning comeback in stocks and a reversal in the Cboe Volatility Index signal that the pain in the market could be coming to an end. The market had a "buy the invasion" moment, Lee said in a note. The S&P 500 opened down more than 2.6% on the invasion news, and oil prices surged above $100 per barrel. However, markets typically sell off into the buildup of geopolitical escalations but rally on the day of the invasion. Continue reading "Geopolitics - Sell The Rumor, Buy The News?" →

Oil And Gas ETFs Are Headed Higher

Posted on by Matt Thalman

When the Coivd-19 Pandemic began, the oil and gas industry went into the tank as demand for oil came to an abrupt halt. Around the world, air travel and domestic passenger vehicle travel were essentially non-existent when governments around the world implemented travel restrictions and lock-downs to slow the spread of the virus. Once stay-at-home orders were lifted, demand began to creep higher for oil, but since the airline industries consume a large percentage of global oil demand, for the bulk of 2020, oil prices and demand were still well off their normal levels.

As we moved further into the pandemic and passenger vehicle travel began to increase, airline and even the cruise line industry came back online, demand for gasoline quickly rose. At the start of 2022, demand was once again strong, and as the Omicron variant peeked in January, oil began flirting with $100 a barrel oil prices in the US, a level not seen since 2014.

Just a month or so later, the oil industry seems to be going through another significant change due to the Russian-Ukraine situation. Due to Russia being one of the largest oil and gas producers globally and countries around the world implementing sanctions against Russia, supply for the commodity appears to be a significant issue moving forward.

Most of Europe relies on imported Russian oil and gas. However, the longer the war in Ukraine continues, there is ever-increasing likelihood that Russian oil and gas may not Continue reading "Oil And Gas ETFs Are Headed Higher" →

Weekly Stock Market Forecast

Posted on by The INO.com Team

This week we have a stock market forecast for the week of 3/6/2022 from our friend Bo Yoder of the Market Forecasting Academy. Be sure to leave a comment and let us know what you think!

The S&P 500 (SPY)

SPY Weekly Chart - Stock Market Forecast

Not a lot of clarity out there after a week of post-invasion and a state of the union speech!

There are a lot of cross-currents out there right now, and the risk just isn't worth the reward, in my view.

I'll plan to sit tight in SPY again and deploy a little risk into a new trade as I wait for more substantial clarity to show itself. Continue reading "Weekly Stock Market Forecast" →

Inflation And Ukraine Crisis Cause Gold To Surge

Posted on by The INO.com Team

Gold prices have been moving to a higher value at a pace not witnessed in quite some time. On Monday, gold futures basis most active April 2022 contract opened at $1920 and closed at $1900 after recovering from a low of $1893. On Tuesday, gold prices gained over $40 and accelerated the defined uptrend that began the first week of January. The rally has continued today.

As of 4:22 PM EST on Friday, April futures are currently up by $39.40 (2.00%) and fixed at $1974.90, which means that gold gained $74.90 this week, resulting in a net weekly gain from Monday's low to today's current price of 4.3264%.

When added to the price advance of January 31, that accomplishment reveals a profound fact. In just over one month (January 31 to February 4), gold prices have gained $194.90, a percentage gain of 10.94%. Continue reading "Inflation And Ukraine Crisis Cause Gold To Surge" →

Ukraine/Russia Conflict Weighs On Markets

Posted on by The INO.com Team

Stocks fell on Friday, ending the week lower with the DOW posting its fourth straight weekly loss as worrisome developments in Ukraine weighed on sentiment.

As far as Friday's trading was concerned, the DOW dropped 179.86 points or -0.53%, to close at 33,614.80. Likewise, the S&P 500 declined -0.79% to 4,328.87, while NASDAQ moved down -1.66% to end the week at 13,313.44.

On A weekly level, the DOW fell -1.30%, the S&P 500 slid -1.27%, and the NASDAQ suffered the most significant weekly loss, losing -2.78%. However, the flight to safe havens continued with gold gaining +4.30% and the U.S. Dollar gaining +2.03%. Continue reading "Ukraine/Russia Conflict Weighs On Markets" →