Here is my second T Minus 2 days post. The year slips through our hands like water, don't they? I suppose we are to drink from our hands before all the water slips away.
For the first time in many years, I am not having NY's dinner at my home. Rather, one of my regular guests will be hosting this year. So we will be guests. There will be the same group of us, 8, as last year. It is a comfort to see the New Year in with people that we know and love.
With the thin trading in the market, I've spent most of my time building my chart lists in StockCharts. I find it helpful to look at stocks in sectors and to be able to look at a glance how stocks are doing relative to each other in the same group.
Tim Wood, a technician that I've mentioned here who is interviewed regularly on FSO and writes for them as well, wrote an interesting post on the 12.28.07 market wrap (you may have to get to it from the archive if you click on the link to far from today's date. I hope that you'll take time to read it. In it he discusses his feeling that we've not yet seen the cycle lows for this 4 year cycle.
I still have Martin Armstrong rattling around in my head. I'll reference you to my 04.07.07 post on Armstrong. You will remember that on 02.27.07, the market made a swan dive. Uncannily, it was one of MA's "market top" calls. The market then went on to make a much higher high [Dow] (February break (not high) was ~12,600; market high of 14,187 for a 12.6% gain). Given that discrepancy, I'm not sure that the Armstrong model and the market peaks and troughs work outside of the 02.27 oddity. However, the next trough on the Economic confidence model is 03.26.08. I'm not speculating on any of this, merely resurrecting the model. But it's worth noting that the Dow troughed on 10.09.2002 and the model shows the bottoming of 11.08.02. I guess, then, that the next real dilly of a bottom would be in the 2011 time frame with our having a dip and and a bounce within that time frame. I surely don't know; and I recognize that my fascination with the model is grounded in neither knowledge nor objectivity.
Some numbers out this week show that the European economy is slowing as well as that of Japan's. Both are marked by increasing inflation--similar stories to our own. I'm seeing more doubts expressed about the theory that the BRIC economies have decoupled from our own. I do not believe that we will have any confirmation of the theory's being accepted by the market place until we see commodity price ease and inventories build. Nevertheless, the strongest sectors have been commodities (to include solar) and the defensive sectors (consumer staples, healthcare, tobacco).
While the September 30 quarterly earnings season was important due to its being the first reporting period post the credit market blow up in August, December's quarter end will be important as well. It's year end, and with that there will certainly be some more cobweb busting in the recessed corners of companies' balance sheets. We may also get confirmation of some of the slowing economic numbers.
I'm doing a bit of that cobwebbed corner cleaning myself. It's a natural time of the year to do it.
My best to each of you in the New Year. May it bring you good health, prosperity, wisdom and more importantly may it enrich the relationships with your family and friends.
For the first time in many years, I am not having NY's dinner at my home. Rather, one of my regular guests will be hosting this year. So we will be guests. There will be the same group of us, 8, as last year. It is a comfort to see the New Year in with people that we know and love.
With the thin trading in the market, I've spent most of my time building my chart lists in StockCharts. I find it helpful to look at stocks in sectors and to be able to look at a glance how stocks are doing relative to each other in the same group.
Tim Wood, a technician that I've mentioned here who is interviewed regularly on FSO and writes for them as well, wrote an interesting post on the 12.28.07 market wrap (you may have to get to it from the archive if you click on the link to far from today's date. I hope that you'll take time to read it. In it he discusses his feeling that we've not yet seen the cycle lows for this 4 year cycle.
"TheI like Tim so much because he brings great discipline to his work. I always feel like he speaks from the position of facts--as he constructs and interprets them--rather than from ego and emotion (a la Kudlow, Cramer).
bottom line is that the market can do anything it wants and only a fool
would say that he knows for sure what is going to happen. But based upon
the fact that 90% of the previous Dow theory, bearish primary trend
changes have been significant market developments along with the ongoing
statistics and indicators surrounding the 4-year cycle, all appearances
are that the 4-year cycle low still lies ahead. Also, in accordance with
Dow’s three movements, the advance out of the November low has been a
counter-trend “Secondary Reaction” in opposition to the Primary
Trend change that occurred on November 21st."
I still have Martin Armstrong rattling around in my head. I'll reference you to my 04.07.07 post on Armstrong. You will remember that on 02.27.07, the market made a swan dive. Uncannily, it was one of MA's "market top" calls. The market then went on to make a much higher high [Dow] (February break (not high) was ~12,600; market high of 14,187 for a 12.6% gain). Given that discrepancy, I'm not sure that the Armstrong model and the market peaks and troughs work outside of the 02.27 oddity. However, the next trough on the Economic confidence model is 03.26.08. I'm not speculating on any of this, merely resurrecting the model. But it's worth noting that the Dow troughed on 10.09.2002 and the model shows the bottoming of 11.08.02. I guess, then, that the next real dilly of a bottom would be in the 2011 time frame with our having a dip and and a bounce within that time frame. I surely don't know; and I recognize that my fascination with the model is grounded in neither knowledge nor objectivity.
Some numbers out this week show that the European economy is slowing as well as that of Japan's. Both are marked by increasing inflation--similar stories to our own. I'm seeing more doubts expressed about the theory that the BRIC economies have decoupled from our own. I do not believe that we will have any confirmation of the theory's being accepted by the market place until we see commodity price ease and inventories build. Nevertheless, the strongest sectors have been commodities (to include solar) and the defensive sectors (consumer staples, healthcare, tobacco).
While the September 30 quarterly earnings season was important due to its being the first reporting period post the credit market blow up in August, December's quarter end will be important as well. It's year end, and with that there will certainly be some more cobweb busting in the recessed corners of companies' balance sheets. We may also get confirmation of some of the slowing economic numbers.
I'm doing a bit of that cobwebbed corner cleaning myself. It's a natural time of the year to do it.
My best to each of you in the New Year. May it bring you good health, prosperity, wisdom and more importantly may it enrich the relationships with your family and friends.
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2 comments:
For many years I spent New Year's Eve with the same (very small) group of friends. We developed a little tradition among ourselves that we really enjoyed. Each of us cited the best thing that had happened to us in the previous year -- and the worst.
Because we knew each other well, the best and worst were never surprises. (A couple married, so you can imagine what their best "thing" had been for that year.) Still, it was always nice to look back and isolate a special point/event/happening.
Regrettably, our little group fell apart pretty much in the same year when everyone except me -- literally every one -- moved out of New York City.
The years have passed. I still miss our New Year's Eves together. Sadly, we're all so far away from each other, from west to south, that I know we'll never reassemble all together again. I have travelled far to visit and see every person, but it's not quite the same as it was when we were all together, in the flesh, celebrating New Year's Eve together in the Big Apple.
Gemma, thanks for sharing this. My SIL has a tradition of a girls' weekend that she and 3 of her life long friends go away for a long weekend--each year. They pick the destination and they all make it. Through thick and thin.
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