Look For The Big W
Financial portfolio managers are in a bit of a conundrum right now. Why? We calculate that they’re facing a minuscule year end gain for their clients – averaging 9%. That’s a paltry number given the tremendous amount of bullish run of opportunities. The DOW has moved approximately 1697 points (+10.82%) just after the beginning of 2014. That’s 291 days, so far.
Yet, someone left the food cooler out on the picnic table enticing the Bears to come and make their havoc in early October. And yet, the Bull came charging back providing us with a plethora of “buy” opportunities by the time the Day of the Dead arrived.
Globally, the economic situation is unstable signaled by the unprecedented robust flight to invest in the greenback and US equities. The USD/JPY sit a record high at over 114 yesterday. Foreign currency markets are in dire straits as the flight to the dollar continues.
“V” is for “Mean Square Deviation”
“It’s under the big “W”, I tell ya.” Jimmy Durante’s dying character’s lines from the classic It’s A Mad Mad Mad World film.
You may have noticed on your Daily chart the DJI ‘V’ formation.
The next technical formation that one ought to be looking for with the Dow is the “W”.
Weeks before, God as my witness, in the midst of massive three digit negative plundering sell-off plunging point moves with the Dow, I overheard the uttering of St. Crispin’s Day speech in whispered voices on the trading floor.
Be it so the will power of buyers flooding in turned things around, and while the trader’s wounds may be healed by October’s end of the month buy-back demands, we feast not till such day that is worthy of celebration.
All may seem well within the castle walls, yet below the drawbridge gauntlet – the financial moat has signs of a drought; and more ominous is the fact that behind the granite stone walls there still resides the mischievous “Skew” that is yet to be tamed, my dear Yellen. We, the merchants of Wall Street remain under siege.
Ya thee is right to say the Bull charged back in full fury against that which was un-Bearable. Yet, stay diligent and alert, and remain wary of the Bear’s shadow that may fall upon this day of prosperity at the first glimpse of future’s light.
Bear in mind that what remains in the short-term future is not compliant to Greek law, nor foretold by Brownian curves. The 30 titular DOW heroes of our marketplace arena still Bear its title as analytical simulated trades proved with smirks and smiles.
We are under siege by tomorrow’s economic reports; Consumer Price Index, Retail Sales, 10-Yr Treasury Note Announcement, and ADP Employment Report coming out tomorrow. The threshold of release approaches while Black-Scholes The Soothsayer feverishly calculates simulated outcomes. And could it appear upon our exchange’s gauntlet – Black or White Swan?
As all that are wise and true to themselves know that it will be in the market arena that finally determines whether the Bull or Bear will stand as victor.
Meanwhile our castle remains siege until such time – though gleams of evidence that are produced before hand may give us and edge in knowing if the Big W will be formed.
Measure for measure, what remains to be seen is if there will be a Big W or not.
It’s a Mad Mad Mad Market.