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Conclusion: Technicals Lead, Fundamentals Lag. The following two case studies illustrate a very important point: The market and individual stocks (i.e. technicals) move months BEFORE the fundamentals move (up or down). The reasons “why” are lengthy and outside the scope of this article. Instead of discussing the “why” we shall focus on the “what.” The reason is…
Sovereign debt woes continue to be the bane of this rally. At the end of April the S&P Rating Agency downgraded Greece’s debt to “junk” status, which accelerated the steep sell-off in the euro and sent it down to its 2008 lows! This sparked a world-wide panic sell-off which sent stocks plunging. In addition, Spain and Portugal’s debt was also downgraded which put pressure on a host of capital markets. Italy and Iceland are the two nations which analysts believe are also dealing with ominous debt levels. All of this helped the US dollar enjoy one of its strongest gains against the euro in over a year. Since November, the greenback has rallied smartly and jumped above its 50-day moving average (DMA) and 200 DMA lines. As expected, the stronger dollar sent US stocks and a slew of commodities (i.e. dollar denominated assets) lower as investors continue to debate our economic future.
Following excerpt explains it all: But doesn’t money growth produce inflation? Normally, yes, but it has to go somewhere for that to happen. He says, “You miss the circulation effects as the money moves between buyer and seller, saver and spender, three or four times. [Now] it just stays in the bank.” Full Article: Barron’s:…
Lower Fuel Prices Help The Airlines Over the last eighteen months, oil prices have plunged over 60% and remain in a ugly bear market. Certain industries benefit from lower oil prices, most notably the airlines. It is important to note that fuel is the biggest expense for the airlines and the fact that fuel prices have fallen…
The Lovely: Fed Meets Next Week and a lot of open questions: Taper? Not Yet? How Much? Good: Market and leading stocks acting well China said its exports rose by 7.2% in August, topping estimates for a 6% gain. Read here US consumer credit growth rose at a 4.4% annual rate in July expanding by $10.4…
JOIN FINDLEADINGSTOCKS.COM TODAY NOT MAKING A DECISION CAN BE COSTLY, ESPECIALLY IN A BULL MARKET Why Global Central Banks Continue To Flood The System With Liquidity: Central banks know that the global economy still needs help. Over the past 5 years, global central banks have flooded the system with liquidity and embarked on an unprecedented…