Some buying interest among investors finally materialized, moving prices higher, although underlying negative economic conditions remain unchanged (wasteful federal spending taking place, an unresolved debt ceiling, the Fed planning more rate increases, persistent inflation on the consumer, and more corporate layoffs).
Not sure what new information the institutional investors learned that prompted them to suddenly buy stocks last week, but it is a refreshing break from the stock market’s recent sluggish price action.
Rising prices of many – but not all – stocks increased most of our long position gains or at least reduced losses on those that haven’t gotten any traction yet. Our shorts are still profitable.
Very few trades to act on this week – any potential uptrend needs to persist longer for prices to move enough to signal new trades.
Market pundits at the moment seem to be in one of two camps – those suggesting last week’s upward price bias is a sign of an impending rally after prolonged – and excessive – pessimism, while others are convinced another huge market decline to new lows is just around the corner. The only thing certain is that someone will be wrong. In the meantime we rely on our analytics to tell us what the “smart money” institutions are doing so we do the same, on a stock-specific basis.
Get your first month FREE when you subscribe
A full month of actionable insights on which stocks to invest.