Bull, Bear Battle Takes a Turn…
Bulls bite back…
My market updates are intended to be few and far apart; reserved for noteworthy, extreme moves in the market. But, extreme market moves, certainly noteworthy, have occurred with a higher-than-normal frequency this month so far. This is my third in 8 trading days. No surprise, given the month we are in. So goes October! Today’s brief note is to highlight the bullish behavior in the market, a welcomed change in the market which has been in the grips of the bear’s paws since the first of the month. For the major U.S. stock indexes, it was the best day since March 26. The Dow soared over 500 points. The strongest showing was the NASDAQ, jumping nearly 3%. The impressive, bullish bounce back today went a long ways to regaining all that was lost this month, recapturing about 40% of those recent declines today. I have, for over 33 years since my rookie season as professional investment advisor, focused mainly on market technical conditions for hints of the market’s health and near term direction than anything else. Look at the chart of the NASDAQ index below for an example:
My market updates are intended to be few and far apart; reserved for noteworthy, extreme moves in the market. But, extreme market moves, certainly noteworthy, have occurred with a higher-than-normal frequency this month so far. This is my third in 8 trading days. No surprise, given the month we are in. So goes October! Today’s brief note is to highlight the bullish behavior in the market, a welcomed change in the market which has been in the grips of the bear’s paws since the first of the month. For the major U.S. stock indexes, it was the best day since March 26. The Dow soared over 500 points. The strongest showing was the NASDAQ, jumping nearly 3%. The impressive, bullish bounce back today went a long ways to regaining all that was lost this month, recapturing about 40% of those recent declines today. I have, for over 33 years since my rookie season as professional investment advisor, focused mainly on market technical conditions for hints of the market’s health and near term direction than anything else. Look at the chart of the NASDAQ index below for an example:
What you can see by looking at the ascending, smooth black line, the NASDAQ regained a closing price level, closing meaningfully above the line. It did that on above average volume. The line is called a 200 day-moving-average, plotting daily closing prices for 40-weeks. Notice how this important growth market stock index has not been below that key support line for the entire duration of the chart, which is 12 months, except in recent days.
True to form, as stocks rise, fear falls. Today, in the face of the U.S. stock rising more than 2%, the “Fear” index (VIX) collapsed, falling nearly 18%. This is the exact opposite of last Wednesday’s market action.
What now? The has been a lot of interest in interest. There will be more interest in earnings. We are in the top to the first of the earnings reporting period now. We will be watching the technical reaction to the fundamental numbers being released daily.
It was a strong day for the market, and an especially good day fro growth. As mentioned, the NASDAQ (the home of growth stocks) led the way today up 2.9%. True to our mission, we beat it. BAM’s Thematic Growth portfolio, guided by ERPE’s stock research and selection methodology, gained 3.4% today.
Thank you for your continued trust and confidence. I remain vigilant as I manage and oversee your investment account.
Please call anytime you have a question or I may be of help. I am always happy to be of service.
Sincerely,
John Gardner