The Stock Market

[mjp28]

3 hours ago, Westside Steve said:

 

The very first thing any good financial advisor should ask you is what is your age, time horizon and risk tolerance and then move on to specific goals and an overall plan like budgeting, saving including emergency money, family situation, retirement plans etc.

People lately have got a bit stock market crazy and have overlooked cash investments partly too because the cash market has been at historic lows and doesn't look to rebound anytime soon.  The days of 10% + CDs are gone and older people are taking more risks with their money especially if there is a long recession or God forbid depression and years of recovery time.

Once you have made and are comfortable with your plans go for it......but don't be afraid to periodically review your goals, objectives and time horizons.

Just a starting point for all of this financial planning stuff, you better believe a lot of that is going on right now.

ALSO if you're in cash right now this might be a good time to buy good stocks at reduced prices.

[Westside Steve]

22 minutes ago, mjp28 said:

The very first thing any good financial advisor should ask you is what is your age, time horizon and risk tolerance and then move on to specific goals and an overall plan like budgeting, saving including emergency money, family situation, retirement plans etc.

People lately have got a bit stock market crazy and have overlooked cash investments partly too because the cash market has been at historic lows and doesn't look to rebound anytime soon.  The days of 10% + CDs are gone and older people are taking more risks with their money especially if there is a long recession or God forbid depression and years of recovery time.

Once you have made and are comfortable with your plans go for it......but don't be afraid to periodically review your goals, objectives and time horizons.

Just a starting point for all of this financial planning stuff, you better believe a lot of that is going on right now.

ALSO if you're in cash right now this might be a good time to buy good stocks at reduced prices.

Oh I know, I've often use hindsight to look back and say man I wish I would have purchased this or that real estate. Unfortunately a couple of them are worth about half what I would have paid for them. And if anyone do this downturn was coming I would have just transferred everything to the money fund and waited a few months. Haha

WSS

[mjp28]

33 minutes ago, Westside Steve said:

Oh I know, I've often use hindsight to look back and say man I wish I would have purchased this or that real estate. Unfortunately a couple of them are worth about half what I would have paid for them. And if anyone do this downturn was coming I would have just transferred everything to the money fund and waited a few months. Haha

WSS

Hindsight is such a wonderful thing and it's never wrong!    They were showing baseball cards on the Antiques Roadshow recently including a 1952 Mickey Mantle near perfect rookie card valued at $25,000 to $30,000.   I had a very complete set from the 1940-1960s many from a kid up the street who was one of the first ones to go to Vietnam around 1965 and cans of marbles......all gone now.

I always tell my wife that I could have bought her a really nice Mercedes Benz with it.  Now that was a good investment "gone with the wind".

One of the toughest things to do in investing is to forgive yourself and move on.    (but I still could kick myself on the cards )

 

 

[Tour2ma]

6 hours ago, OldBrownsFan said:

I for one am concerned about the national debt. Maybe we had to do this stimulus but shame on any politician adding wish list goodies. The entire stimulus should have been soley for coronavirus related issues. We are heavily in debt already. Maybe this is money we need to spend but it is still money from an already maxxed out credit card. As everyone knows running up debt on the credit card never ends well.

I hear ya, OBF, but bear this in mind... debt of this magnitude would have likely been generated anyway had we fallen into a Covid Depression. Such would have been the depth and breadth of the economic contraction. Difference is that it would come with a lot more Societal pain. And contracting gov't would not be an option... it would only compound the downward spiral.

Also of some solace is that while some parts of this package are "forgiven", others are true loans that will be paid back albeit it at low or no interest.

My concern? Inflation on the backside of this mess. We just had to goose the hell out of this economy and that's a lot of money we are fixing to set loose.

[Tour2ma]

Can't live in the land of woulda shoulda coulda... it'd drive you crazy.

[mjp28]

16 minutes ago, Tour2ma said:

Can't live in the land of woulda shoulda coulda... it'd drive you crazy.

I've learned to cope with that.......... really...........honest, never bothers me....... much. 

[OldBrownsFan]

23 minutes ago, Tour2ma said:

I hear ya, OBF, but bear this in mind... debt of this magnitude would have likely been generated anyway had we fallen into a Covid Depression. Such would have been the depth and breadth of the economic contraction. Difference is that it would come with a lot more Societal pain. And contracting gov't would not be an option... it would only compound the downward spiral.

Also of some solace is that while some parts of this package are "forgiven", others are true loans that will be paid back albeit it at low or no interest.

My concern? Inflation on the backside of this mess. We just had to goose the hell out of this economy and that's a lot of money we are fixing to set loose.

Maybe those 70"s WIN buttons will be making a comeback?

[mjp28]

1 minute ago, OldBrownsFan said:

Maybe those WIN buttons will be making a comeback?

Up to now for the last 8+ years the worry has been disinflation and record low interest rates just check out the 10 and 30 year rates.

And 30 year fixed loans on real estate is at unheard of low rates, less than my parents paid in 1963 with their open ended 25 or 30 year mortgage they paid off in about 10 years.

Old timers who lived through the great depression hated debt of any kind now it's no big deal......I guess.

[Tour2ma]

Good day for the market today. S&P finished up 6.24%. It and the other indices surged during the last 15 minutes of the day.

During the day the popular theory for the rise in the face of the the job loss figures was that there was a whisper number that was much higher. I think I mentioned a rumor a day or two ago that it could be as high as 4mm. Well as is often the case when news is less bad that expected... than it could have been the markets do not simply react positively... they overreact positively. It feels like today was one of those days.

The other thing now being heard is that the market will retest "the bottom", i.e., in coming weeks the averages will fall to the depths from which we just emerged. Why? Because that's what Bear markets do... or so we are being told.

One thing everyone agrees upon... to achieve a more complete recovery will require the defeat of the virus... and that means effective treatments and ultimately a vaccine.

The VIX fell a little today, but remains elevated at just over 61.

 

Me? Again trimmed the high flying ZM and TDOC. Both are new companies whose stock prices have surged due to the virus far more than their business revenues have. Their totals are at levels I do want to further increase as when the virus does subside they price will likely fall. So i keep taking profit in small increments. Also trimmed a couple chip stocks which never fell as far as the broad market and have regained a good bit of what they lost. All chip stocks were up nicely today because one I do not own reported a good quarter this morning lifting the sector.

But I also nibbled at buying a number of stocks today... ones I had trimmed in January, but had never gotten around to adding to during the succession of dips on our way down. Most of these stocks were up on the day, so I chased them a little (bad discipline), but almost all are 40% or so below their pre-Covid levels, so I felt it was time to move.

Also set a number of sell orders based on some chart work. Sell levels are 10-30% above where we are now. The orders are good for 90 days. Not all will get there, but seeing the orders keeps my intent in mind.

 

[Tour2ma]

8 minutes ago, mjp28 said:

now it's no big deal......I guess.

Now folks seem to hate equity...

[mjp28]

14 minutes ago, Tour2ma said:

Now folks seem to hate equity...

I was watching a few of those talking heads and their guests on CNBC today about the economy, Fed, business problems and all of that.

This is no usual recession by any shot and I'll agree with that.  This was not mortgage and banking catastrophe like in 2008 or a NASDAQ tech wreck like in 2000 or computer crash quick drop like in 1987 or other business caused economic drop this was an act of God event.  It may go as fast as it came "IF" the coronavirus goes away to some satisfactory level..... we'll see on that.

One thing though we had a more than slightly heated or overheated market so the DOW might get back to maybe 25,000 and then see what happens.

Equities, well the DOW 30 is having the best week in 90 years, since 1932 it would have been a good jump back in week.......if you are a trader.

We'll see how many of these snap back moves we have until the market goes back up  -or- down.   Stay tuned and buckle up -and- relax.  

[mjp28]

One of my favorite little toys the free StockSpy an easy way to monitor any indicies from all over the world with your choice of tools like moving averages for any time periods from intraday to many years.

You can also put in any stocks you want to follow.  It even has news information on the left side.  Try it.

[Tour2ma]

Will look at it...

 

Here's an interesting article about where we may be now with a couple tidbits I never knew...

https://www.msn.com/en-us/money/savingandinvesting/heres-why-stocks-are-rising-on-terrible-news/ar-BB11LbcT?ocid=spartandhp

[Tour2ma]

And this morning is why you need to maintain market discipline... every I nibbled at yesterday, is on-sale today at "5-10% Off". And while each nibble wasn't much when you rack up a dozen nibbles then all of a sudden the bag of cheesecorn is gone and you're left with a bad case of FOMO...

The three-day rise is looking now like a classic Bear-market rally.

My fav analyst just said (again), " I can't see the market bottoming until the virus tops."

 

Market indices this AM are off roughly 3.5% across the board... was down a little more earlier.

 

[mjp28]

4 hours ago, Tour2ma said:

And this morning is why you need to maintain market discipline... every I nibbled at yesterday, is on-sale today at "5-10% Off". And while each nibble wasn't much when you rack up a dozen nibbles then all of a sudden the bag of cheesecorn is gone and you're left with a bad case of FOMO...

The three-day rise is looking now like a classic Bear-market rally.

My fav analyst just said (again), " I can't see the market bottoming until the virus tops."

 

Market indices this AM are off roughly 3.5% across the board... was down a little more earlier.

 

I've picked up a few good sayings and basic principles since I got into the market in 1971 just before the market crossed 1,000 for the first time........and then crashed and burned back to 700 and basically died for a decade.

Sayings like was that a bear rally or a "dead cat bounce" ?   Most all downturns have a "w" bottom before a true reversal.  The trick is always trying to figure it out.  I like to use the moving averages as a big key indicator.  Early on and for about 30 or so years I was a technical trader watching all of that stuff.  The WSJ was nice in undergraduate school and required reading in the MBA program, I had it sent to my office at work and read it everyday at lunch to be ready when you went to class.  I also had the weekly Barron's sent to my house for weekend reading.  Good basic information along with other magazines.

The former Barron's editor in chief Alan Abelson had one I always remembered...... "when you buy a stock you are buying it from someone else who thinks it will go down".

And from anonymous......"don't buy into a bear market until you see the blood running in the streets".     Good advice.

[Tour2ma]

S&P closed down ~3.3%.

Why? CNBC's Jim Kramer thinks the "Quants" are in control.

Who are "The Quants"? Programmed computers on which there are massive algorithms that read news, market trends, etc., and act upon the info faster than is humanly possible.

Yrs... it's the rise of the machines.

 

Me? Trimmed a little ZM... lil sucker just won't stop going up. Nibbled at adding a little Shake Shack (SHAK)... a once, high-flying, high-dollar burger joint that's a Josh Brown favorite (and it shows.... he gets ribbed about his weight... and love of food stocks... a lot). Shak is still about 60% below it highs.

Josh's former stock love was DNKN... I think you can decode that one... but he sold out a while ago and moved to SBUX.

 

Big, late, breaking news... JP Morgan-Chase CEO, Jamie Diamond, and his Execs bought a bunch of JPM stock in last day or so. $17mm by Jamie alone. Diamond is kinda famous for buying stock at the bottom in 2016. The date of that buy has become known as the "Diamond Bottom".

Doesn't mean this time marks the bottom... but it doesn't suck.

Coincidentally I bought some JPM yesterday... Thanks Uncle, Jamie!

[mjp28]

Circuit breakers were put in and tweaked up largely because of the mindless rapid fire computer trading.

........ just like these damn spell check programs, constantly changing my words even phrases and I generally don't proof read.

Edited March 27, 2020 by mjp28

[Tour2ma]

28 minutes ago, mjp28 said:

The trick is always trying to figure it out.  I like to use the moving averages as a big key indicator.

Oh yeah... amateur chartologist here...

I use 3-year charts now and have for a few years. Keeps the SMAs and other tools in the "weeks" time frames. Keeps me from overreacting to short-term noise as I grew to do with 6 or 12-month charts.

I run:

• In chart keys are: 20, 50, 200 week SMAs and Bollinger Bands (20,2) ... luckily I can select my colors... plus Dividends and Splits.
• RSI, Slow Stochastics, MACD, Momentum and Volume all below chart.

I look at the first three under the chart in order primarily to trigger actions.

Also look to chart for support, resistance levels, trendlines, etc.

There's a chart-guy named Carter Worth who I have learned a lot from. He's a CNBC Fast Money regular and the best I've seen.

 

[mjp28]

Yes like being an amateur sleuth I also look at trading volumes particularly extremely low or high ones, StockSpy puts them on the bottom.

When picking stocks I look first at things like the P/E, dividend yeild, beta, IPO prices if applicable among others.

[JAFBF]

Brought this up with Tour several days back.

Took a bit longer than expected (?), but here we go.

 

https://www.washingtonexaminer.com/news/coronavirus-relief-package-contains-600-billion-in-tax-cuts

 

Add in the Nuke POTUS just dropped on the FED and this Rocket is ready once this Corona farce ends (exposure would be EPIC, but there are complications too that).

 

[Tour2ma]

POTUS nuked the FED? How'd the MSM miss that?

 

As for the Bill...

I hardly think $600b in tax breaks, which is 10% of the total cash infusion coming, is going to matter much in the grand scheme... let alone a percentage of that $600b that is merely delayed taxation.

 

[Tour2ma]

Been a couple sessions since an update, but honestly... not a lot has been going on. Everything seems muted now.

The big "Rescue Bill" is now baked in and as long as the roll out and distribution goes well, i.e., there are no fuck-ups, it's not looking like a factor going forward.

So what's changed?

It's looking like the panicked Sellers finished selling in the last week of March. Most "corrections" are punctuated by a final woosh of selling... a spike... a very high volume day that stands out. Did not quite see that, but did see five days running of very heavy volume with over 150% of the average number of shares traded.

So seem to be seeing Seller exhaustion now. This doesn't mean there's no more selling or that the market fall is over. For that to happen means that buying sentiment must take over. So we're in a relatively "dead zone" until we see those who were Sellers turning into Buyers and swooping in. Right now Buyers are basically exhausted as well, but are still nibbling.

 

Today the S&P opened down over 3% on the sobering death figures finally being mentioned in The White House daily virus presser, but so far has ground higher (a/k/a/ melted up).

 

Me? Little more nibbling, but I've committed most of the cash I'd raised precollapse as well as that I've raised selling rips.

What I have done is set sell levels based upon valuations of various holdings exceeding predetermined levels at what look to be resistance in the charts. In a couple cases, such as Zoom and TeleDoc, the levels are doubles. If these two are to double, then it needs to happen soon as the boost they've received from the virus is waning. The rest have a lot more time. All are "Good Till" orders.

The plan is to hold whatever proceeds are raised in the coming months for a potential retracement downward this Fall.

 

Next big event? Friday's Initial Jobs Claim update...

After last week's 3.3mm The Street is bracing for a number as big as 9mm this week.

And... something I did not know... this figure will not include "furloughed" workers who are in a different line created by the Relief Bill.

[mjp28]

1 hour ago, Tour2ma said:

Been a couple sessions since an update, but honestly... not a lot has been going on. Everything seems muted now........

Ah the life cycle of some hot business news...... especially if you're a trader and why I got out of day trading back in 2008, that and my play toy margin account. that got blown to bits overnight with tens of thousands (or many more) of other day traders.

Back to the more relaxed life style of watching TCM movies, paint drying, grass growing -and- mutual funds in your IRA and 401(k) mutual funds.......makes me miss those 4 hour west coast Indians games.     

[Tour2ma]

Well... things went south in a hurry today... starting sliding about the time I wrapped up my earlier post.

All indices were off ~4.4% at the close.

 

Why? Some thinking that markets are waking up to the fact that stay at home is going to be around thru May... and that's a second month of depressed earnings.

At any rate some Sellers got their 2nd wind.

 

5 hours ago, mjp28 said:

Ah the life cycle of some hot business news...... especially if you're a trader and why I got out of day trading back in 2008, that and my play toy margin account. that got blown to bits overnight with tens of thousands (or many more) of other day traders.

Never have done the margin thing... and never will.

[Tour2ma]

Futures were flat to slightly off overnite.

The Initial Jobless Claim report was this morning, not tomorrow. The number was 6.6-million... twice last week's figure. The market really did not react... at least not violently. Again this seems to be due to the fact that the "whisper number" was quite a bit higher... around 9mm.

Market opened flat and was drifting down until word came out that Trump had spoken to both Putin and MBS (?... the journalist murdering Saudi Prince) and brokered an oil deal. Trump called arch-conservative, CNBC anchor, Joe Cernan, to hand him the "scoop" and Joe, whose show was over for the day. Joe called into the next show with the news.

Putin has since denied talking to MBS and the market is off its highs of the morning.

 

Not enough of a rip for me to sell. Zoom Video is off about 10% so I may be late to that sale... we shall see.

One other significant portfolio casualty of mine is emerging, Store Capital Corp (STOR). It's a REIT (Real Estate Investment Trust) that specializes in buying buildings/property from small businesses and then leasing the building/property back to the company. The business frees up capital; the REIT adds an income source. Well... turns out in a time when many rents are going to go un-(or under)-paid, STOR's is not a very good business...

 

[Tour2ma]

S&P finished up 2.26%... just below the morning high.

Basically trading seemed to follow the price of oil, which set a single day record ... I believe it was for percentage increase in a trading session, but can't swear to that.

 

[Tour2ma]

S&P closed off 1.5% after opening slightly higher despite the jump in unemployment... basically knew it was coming because of the jobless claims... and then rolled over thru the early afternoon before rallying a little into the close.

Oil prices rose, so that correlation of the week is gone.

What appears to explain the decline is that Wall St. is coming to grips with just how bad this economy is going to get and how long it is going to take to recover. Goldman Sacks put out the following new unemployment forecast...

Given the above why did the market not fall further? Hard to know... likely some combination of:

• the decline to date being as great as it is, i.e., the news is already "baked in";
• FOMO, Fear Of Missing Out, if and when a curative is proven;
• NY bending the curve, showing it can be done here; and
• buyers are around... at least for some stocks.

One of the interesting developments this week is that there were a few more winning stocks for the week beyond the fortunate few like Zoom and Teledoc. Some stocks were up for the week.

[TexasAg1969]

Excellent news here for those who are already old enough for RMDs (required minimum distributions) in your retirement accounts. I had sent an idea to our US Senator Cornyn that it would be a good idea to discontinue RMDs for this year to help both the stock market and elderly citizens. It does that in two ways. First it does not require anyone to have to sell stocks when the market has already been so devastated that older citizens will have to sell at really low levels compared to what they were worth on Dec. 31, 2019 from which you calculate RMDs. Second it would mean less selling pressure on the markets, especially next Dec. 31 by which time you must take out the money. So less pressure on the market means less drop overall. 

So today Fidelity informed me that under the new law just passed RMDs can be waived this year, i.e. I do not have to sell anything or take any cash out as would have been required. I will be submitting whatever forms necessary to do just that and the one I am having done monthly I will get stopped immediately. 

I hope this is helpful to those of you in the RMD category.👍

[Tour2ma]

Not there yet personally, but thanks...

Do you know if it applies to inherited IRAs?

[TexasAg1969]

50 minutes ago, Tour2ma said:

Not there yet personally, but thanks...

Do you know if it applies to inherited IRAs?

Yes it does. I checked with the company where I have an inherited IRA and they said the same thing. I need not take any RMD this year. I passed that on to my siblings and to a couple of friends I know who also have inherited IRAs. 

Also if you do not have it set to take out the RMD automatically but planned to do so yourself later, you don't need to do anything. I had Fidelity already set to take out RMDs for my wife's and for my IRA's with them in June. That is why I had to put in a request to suspend for the year. I did not have to do that for the inherited IRA, but I will have to do that for another that takes out monthly. The only one other than that is a small one I had already withdrawn RMD from, but it was not a stock market one anyway.