November Returns

november

by Steven Sarnoff

November Returns

We welcome the onset of a new month with stocks seeking to extend their record run.

Analysts often look to past returns for an idea of what to expect going forward. But the well-known disclaimer, “Past results are not indicative of future returns,” is always applicable.

One of my favorite market adages is that “It’s the little exceptions that get you.” So one is well-served to view historical returns with eyes open to alternative outcomes.

The following chart arrived in my Inbox, depicting monthly trends for the Dow Jones Industrial Average over the last 20, 50, and 100 years.

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What’s Going On (In The Market Now)?

whatsgoingon

by Steven Sarnoff

The extended record-setting move up in the venerable S&P 500 is making any self-respecting seller “wanna holler and throw up both my hands,” and many of the weaker shorts are capitulating.  This has my contrarian senses tingling.

Let’s have a look at what’s going on in three important markets, stocks, interest rates, and the US dollar.

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Have Your $CAKE

chcake

by Steven Sarnoff

Though you won’t find your favorite vegan technical analyst partaking of Cheesecake Factory ($CAKE) fare, the shares are moving sweetly for our Options Hotline subscribers.

In mid-September I noticed the unhealthy eatery’s shares were not as sickly as they appeared. The signs of a potentially vigorous and natural rebound were flashing and, from the menu of available options, I recommended a January $40-strike call for our readers.

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I $SPY Key Resistance, FYI:

ispy

by Steven Sarnoff

Corporate earnings beats, particularly in the Dow industrials, are propelling panic buying. Central bank monetary largesse and money moving out of bonds (pushing 10-year yields up), along with investor hopes for tax cut legislation is also juicing the market.

I try to tune out the noise and focus on what the character of the behavior of market price movement is saying. Note, in my daily candlestick chart below, the appearance of a “hanging man” followed by a strong negative black candle just as the venerable index is nearing the apex of a bearish rising wedge pattern. This is telling us that buyers are approaching exhaustion and sellers are poised to strike back.

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Is TRIP Headed South?

tripadvislogo

by Steven Sarnoff

Markets don’t move down a one-way street. The news of record-setting stock prices Mr. Trump is so fond of touting hasn’t been booked by this Internet darling. As you can see by my daily candlestick chart of TripAdvisor shares, the online travel brand company settled today’s session pointing south.

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Value, What A Concept!

value

by Steven Sarnoff

Just a week after running over Ford, Tesla today overtook General Motors for the number one spot among US automakers for market value based on stock market capitalization.  Tesla’s drive higher has sparked renewed debate about the concept of value.

Differing opinions make markets. The financial media features many Wall Street analysts flouting Tesla’s share price rise, calling the stock clearly overvalued. Elon Musk, Tesla’s chief executive officer, couldn’t resist schadenfreude by trolling and throwing shade at short sellers with his, “Stormy weather in Shortville…” tweet.

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Will Shaky Support Give Way?

bridge

by Steven Sarnoff

This morning, we are seeing support for stocks being tested.  As the Trump reflation trade loses air, will shaky support give way?  In my opinion, it will.

Following the election, the market was juiced on big bets that Trumponomic policies would boost US growth and inflation, hurting T-bond prices (lifting bond yields). Well, what have we seen? In the wake of Yellen and crew’s action on interest rates, GOP failure to reach a consensus and the abrupt end to health care legislation, and Mr. Trump’s rocky Beltway honeymoon, bond prices have been rising (yields falling). Continue reading

Flash Sale: 16% Off Options Hotline Through This Sunday Promo Code SWEET16

OHLweb

by Steven Sarnoff

I’m not big on promotions, but thought of this one as a salute to Chuck Berry, the progenitor of Rock ‘n’ Roll and to basketball, the sport I love, down to the Sweet 16 of the NCAA tournament.

If anyone you know is interested in subscribing to our service, feel free to pass along this promo.

Attention Traders, Sweet 16 FLASH SALE: 16% Off OPTIONS HOTLINE, Through This Sunday. Enter code SWEET16 to subscribe and receive Steve’s next Option Trading recommendation.

During March Madness, our readers have already seen:

+118% in 1 month on ConocoPhillips
+82% in 9 days on the Russell 2000 index
+98% in 2 days on Citigroup

#OptionTrading #OptionsHotline

Crazy Like A Fox

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Crazy Like A Fox, art by Terry Fan

by Steven Sarnoff

Today was the worst day of the year for stocks, but not too shabby for OPTIONS HOTLINE subscribers. The Superleverage power of my method was on display, as our recommended Citigroup May $60 put, triggered 03-20-17 at $2.00, traded 03-21-17 at $3.30, +65% in 1 day, on a 3% move in the underlying shares, with an always known and strictly limited risk!

On Sunday, 03-19-17, I emailed my readers, “Professionals have seen the recent sector underperformance and are fading the financials. Some may call that crazy, but it may just end up being crazy like a fox.”

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