Morning Comment: Gold has become ripe for a short-term pull-back.


It was another low-volume/uneventful day yesterday...until about 2:30, when the stock market rallied strongly over the last hour and half. When you combine the 12 point gain in the S&P 500 this morning with the 20 point gain the futures are indicating this morning, you put the S&P less than 2% from its February all-time highs. With the Federal Reserve providing a safety net, it is very tough to think that the stock market can see a substantial decline from here. We agree that a severe decline is very unlikely, but there is no question that the action in the market is eerily reminiscent of what took place in 2000 and 2007. In both of those years...a record breaking, but overvalued stock market saw a correction...that was followed by a retest of the old highs in the August/September time-frame. Then it rolled over and began a savage bear market.

Of course, there are differences this time (like there always are). The initial “correction” was MUCH deeper this time around. However, as we mentioned above, the biggest difference is that the Fed is already providing liquidity to the market place. Even though they have throttled-back on this stimulus significantly over the past two months, they still remain ready and willing to provide “whatever it takes” if/when it is needed. Therefore, the odds that we’ll see another debilitating bear market begin over the next few months are very low.

However, this does not mean that we cannot have a meaningful pull-back...or even a full-blown correction of 10% (or a bit more) over the coming weeks. As we have highlighted ad nauseam recently, there are plenty of signs of froth in the market place...with last week’s action in Kodak leading the way. However, there are other signals in other stocks...even from the ...

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Morning Comment: Narrow market...does it matter?


We had another nice day in the stock market yesterday as the tech sector continued to lead the way higher. It does not seem to matter that the rally is a very narrow one, but history tells us that it ...

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Morning Comment: Biggest Near-Term Risk? China.

There is no question that there are a lot of developments from around the globe that are fighting for the attention of the public (and investors) in the mainstream media. Whether it be the continuing Covid-19 crisis, the debate over ...

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THE WEEKLY TOP 10....The risk/reward equation has changed significantly



THE WEEKLY TOP 10


Table of Contents:

1) Is all of the good news already priced into the mega-cap techs over the near-term?

2) Some of the obvious froth in the market place is becoming ridiculous.

3) High yield is ...

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Morning Comment: An August Pull-Back Would Actually Be Healthy


It’s the last day of July and it seems like we’re setting up for an exciting August. In other words, those who are looking for the dog days of summer this year are going to be sorely disappointed. On the ...

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Morning Comment: A Second Warning Shot Across the Bow


It looks like we missed a very compelling week in the markets last week...as the S&P 500 looked like it was finally going to break out of its seven-week sideways range, but fell back within it by the end of ...

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THE WEEKLY TOP 10


I will be on vacation next week, so there will be not “Morning Comments” next week and no “Weekly Top 10” next weekend. Thank you very much.


THE WEEKLY TOP 10


Table of Contents:

1) Liquidity has still been the ...

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Morning Comment: Small-caps Trying to Breakout


Well our call last week that said investors should avoid Chinese stocks on a near-term basis because they had become EXTREMELY overbought has worked out quite well. The Shanghai Index fell 4.5% last night...and has declined 6.7% since we made ...

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Morning Comment: Mega Tech Beginning a Correction?


We saw a decent sized reversal yesterday...as the mega-tech stocks got clobbered after making new highs early in the day. The decline got also go exacerbated late in the day when California announced that that it was basically shutting down ...

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Morning Comment: Amazon is getting VERY overbought

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I love following politics, so I’m one of those crazy people who actually watches political conventions on TV. When I was quite a bit younger, I remember watching Walter Mondale give his acceptance speech as ...

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Morning Comment: Tesla in a Bubble


---Volatility within a sideways range.

---Tesla is in a bubble

---Has the Fed changed the goals of their stimulus injections?



Volatility within a sideways range.

The volume in the stock market has been quite low so far this week...with the ...

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Morning Comment: Happy Birthday America


There’s no question that today is going to be a very “thin” day in the markets, so anything can happen as we move through the day...but there’s no question that the better-than-expected employment report has the stock market rallying strongly ...

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