Forget about oil and water not mixing, these days for investors oil and stocks don’t mix. The near direct correlation between equity markets and the price of oil has far too many confused, perplexed or just pulling an ostrich and sticking their heads in the dirt. Let’s help explain and simplify this new phenomenon.Lower energy prices are a boom for consumers plain and simple. For most businesses these same lower energy costs are a savings dropping right down to the bottom line as well. Hugely positive.Now the elephant in the ointment. All oil and gas producing companies and countries are getting absolutely pole axed by the collapse in en...
Thanks to persistent global slowdown and a strong dollar, the tech heavy Nasdaq Composite Index has been creeping closer to the bear territory, having shed about 18% from its all-time high recorded last July. In fact, most of the tech heavyweight stocks have already fallen into a bear territory, losing more than 20% so far this year. These include Tesla Motors (TSLA –Analyst Report), Amazon (AMZN – Analyst Report), Netflix (NFLX – Analyst Report), Apple (AAPL – Analyst Report) and Cisco (CSCO – Analyst Report). The social networking firm LinkedIn (LNKD – Analyst Report) also witnessed a sharp mel...
During the session on Thursday, there are a lot of things going on, but without a doubt one of the biggest ones will be Janet Yellen speaking to the Congress in the United States. That being said, it is a bit difficult to imagine that you can quantify this at a time so having said that it’s very likely that this market will be volatile. Silver pulls back to find support Silver markets fell significantly to test the $15.10 level, but found enough support to turn things back around and form a hammer. The hammer of course is a very bullish sign, but we do have exhaustion just above. With that being the case, we are looking to buy calls on shor...
Photo Credit: Bob Schoenherr Cisco Systems, Inc. (CSCO) Information Technology – Communications Equipment| Reports February 10, After Market Closes Networking giant, Cisco, is scheduled to report its fiscal second quarter earnings after the market closes on February 10. Cisco is the largest of several tech companies reporting this week that have benefited from the trend toward big data and cloud computing. These areas have grown the fastest for Cisco while its core business continues to struggle. Despite coming off two consecutive quarters of positive earnings surprises, expectations are low going into this earnings call. The Estimize...
The last Housing Market Review covered data released in December, 2015. At the time, I saw the market coiling like a spring. Instead of springing forth, housing market stocks are in big retreat. Recession fears likely have a lot to do with the declines. The iShares US Home Construction ETF (ITB) is now down a gut-wrenching 18% year-to-date. ITB trades at levels last seen October, 2014. The S&P 500 (SPY) is trading at the same relative level, but it has “only” declined 9% year-to-date. iShares US Home Construction (ITB) has had a very rough start to the year even in the wake of relatively good housing data. Source: FreeStockCharts.co...
This article originally appeared on Iknowfirst.com I have been a Plug Power (PLUG) bear for quite some time now. The stock has declined considerably since I first covered it. Missing estimates, history of unprofitability and overpromising results has been the primary reasons why I have recommended investors to sell/short Plug Power over the years. And as you can see from the image below, my bearish stance on Plug Power has yielded over 34% returns. (Source: TipRanks.com) Why I have been bearish on Plug Power I have always advised investors to short companies that have a track record of non-profitability. I have previously recommended shorting...
There’s a reason investors have blindly trusted Wall Street’s “buy the dips” mantra since 2009. In fact… there are 2.3 trillion reasons. That’s because since 2009 U.S. companies spent more than $2.3 trillion buying back their own shares, according to a report by Aranca Investment Research Services. All that buying acted as a floor for stocks and launched the major indices to new heights. But now, after watching stocks fall off the “Wall of Worry” this year, instead of climbing it, investors who simply bought the dip without any strategy are praying new buyback programs will start lifting stocks. Too...
The Walt Disney Company (DIS) reported earnings yesterday and reaction hasn’t been great despite posting descent numbers. On the chart there are two technical developments: one good and one bad. Which way it decides to go is anyone’s guess. But I’ll lay out the two scenarios for you. The Good: The rising trend-line that goes back to the Spring of 2014. Right now DIS is trying to bounce off of this level. It provides a nice risk/reward setup for the stock going forward and could be worth playing here. The Bad: A massive double top formed over the past year that has confirmed this week on the weekly chart. If this chart ...
The move in Gold over the past week or so has captured a lot of attention and is rather exciting as it is the first real evidence of an impending behavioral change in the precious metals complex. I say this because Gold has rallied sharply many times during the last four years, but has always failed to surpass a previous swing point high. The move on Monday finally did that albeit only briefly. Daily closes are usually what matters most in commodities, so I would really like to see a settlement above 1191 to solidify a more meaningful shift. However, time seems to be working against the yellow metal in the near-term as a confluence of various...
The stock market is really a by-product of tremendous forces at work primarily in the currency and commodity markets and on Tuesday, traders were very uncertain given this is Janet Yellen’s week. The Federal Reserve chairwoman goes up to Capitol Hill to deliver the Fed’s semiannual monetary policy report to the House Financial Services Committee on Wednesday and Senate Banking Committeeon Thursday. The Fed has recently announced that its bank stress tests for 2016 will include a period of negative yields on short-term Treasuries as part of its “severely adverse scenario”. So all ears will be on what Janet Yellen has to say as this...