Off your game?
Read our free, updated as of Mar 3, 2022, Dr K report on how to optimize your mind and body so you can boost your focus when trading the markets.
Meet Dr K !
Chris Kacher
  • Nuclear physicist
  • Stock & crypto market wizard
  • Blockchain builder
  • Bestselling author
  • Top 40 charted musician
  • Biohacker
  • Former computer hacker
Your email will always remain private.

MLR - Premarket Pulse 6/17/13

After a sharp upside day on Thursday that saw the S&P 500 Index bounce of its 50-day moving average, the market on Friday pulled back and retraced more than half of Thursday's gains. While the volume and rise on Thursday was sufficient for a follow through day on the S&P 500, follow-throughs that occur in June have a poor track record with the overwhelming majority failing. According to IBD, there have been seven follow-through days during the month of June since the year 2000. Not one led to a sustained market rally. The Market Direction Model's (MDM) buy signals during the month of June confirm this as they have not fared much better, despite the fact that the MDM has well outperformed IBD's basic market direction calls (e.g, "market in confirmed uptrend" and "market in correction") since the newspaper began making such calls in December 1994.

Recent market weakness has largely been a function of Federal Reserve board members hinting that a recovering U.S. labor market and economy would necessitate a reduction of the Fed's bond buying program, essentially a tapering of quantitative easing. The Bank of Japan added further selling pressure when they recently implied that their "Kamikze" QE program will not extend as far as investors had hoped. This sent the CBOE Volatility Index (VIX) to its second-highest level of the year, indicative of the resulting market volatility. That said, the question is whether the economy is really recovering. The slowdown in China is apparent as well as the everlasting recession in the UK and in Europe. The World Bank has also cut its forecast for global growth. The Fed may find that withdrawing from its current QE program is easier said than done.

Futures are up nearly 1%. The models are looking for sufficient evidence that the sideways action of the last few weeks is over. This may require the major averages to either break above or below major points of support or resistance, respectively. Action within leading stocks will also be a key variable.

Like what you read?
Let us help you make sense of these markets by signing up for our free Market Lab Reports:
This information is provided by MoKa Investors, LLC DBA Virtue of Selfish Investing (VoSI) is issued solely for informational purposes and does not constitute an offer to sell or a solicitation of an offer to buy securities. Information contained herein is based on sources which we believe to be reliable but is not guaranteed by us as being accurate and does not purport to be a complete statement or summary of available data. VoSI reports are intended to alert VoSI members to technical developments in certain securities that may or may not be actionable, only, and are not intended as recommendations. Past performance is not a guarantee, nor is it necessarily indicative, of future results. Opinions expressed herein are statements of our judgment as of the publication date and are subject to change without notice. Entities including but not limited to VoSI, its members, officers, directors, employees, customers, agents, and affiliates may have a position, long or short, in the securities referred to herein, and/or other related securities, and may increase or decrease such position or take a contra position. Additional information is available upon written request. This publication is for clients of Virtue of Selfish Investing. Reproduction without written permission is strictly prohibited and will be prosecuted to the full extent of the law. ©2024 MoKa Investors, LLC DBA Virtue of Selfish Investing. All rights reserved.
Copyright ©2024 MoKa Investors, LLC DBA Virtue of Selfish Investing.
All Rights Reserved.
privacy policy