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Glue-Sniffing on Wall Street: ‘Small Price to Pay for a Good High’


Considering the dour outlook for Q1 earnings, the stock market’s exuberant run-up over the last month feels like Tennyson’s Charge of the Light Brigade: “Into the valley of Death rode the 600…’  And yet, we know from watching the shares of Boeing, Apple (see chart inset) and Facebook climb vertically into an avalanche of negative news concerning them that Wall Street’s ‘600’ really don’t give a damn about the news, or even about ‘fundamentals’.  Earnings are expected to come in around 4.5% lower than a year earlier, and this will be the first quarter in three years with negative earnings growth. Bank-stock profits in particular have come under pressure because of the yield curve’s flatness, and financial shares are therefore likely to be laggards if the broad  averages continue higher on vague emanations of possible Fed easing.  This amounts to glue-sniffing, and although the habit will kill you, or at least your brain eventually, at the time you are doing it, it probably seems like a small price to pay for a good high.

Please do not ask trading questions!

  • Gary Caumont April 9, 2019, 12:16 pm

    AAPL 1st leg up from 3/13 180.92 low targeted 201.35.
    2nd leg up targets 220.31 by 5/6 if we stay above today’s (4/9) 199.68 low. Conversely, below 201.35 target is bearish, one should be flat looking to get short below 199.68.

  • none April 8, 2019, 9:40 pm

    Observing the recent high be put or in place from 03 22 2019 date. Is to be seen as the high and no longer a Bull Trap. Bull Traps are a process testing a recent high, though we may observe the market as doing such.

    ….I have move towards this high point, being the 1st high for only the 1st downward wave due. Moving under the Xmas low point will trigger a wider price and time degree lower.

    This is quite negative for the longer term market as or is in a trading range, suggesting the 01 2018 high point (being the fastest 9 day fall in price ever) to only a trading range shift, as also the recent 10 2018 high point of the last 20% fall in price to be the same.

    Observing the market in this way one sees a massive distribution of stock pattern, nothing quite the same in pass history. Yield itself can also be seen in this way as it is lower for the pass 4 months, a time stamp where equities turn sour from major high points.

    Quite negative suggesting the
    Bull Trap’ that most all bear markets creates may come in at much lower levels.

    The Dow UTY index recently printed all time highs and is or has change from an interest rate indicator to an economic indicator.

    Over time observe the 02 2018 low point as the ‘crash test’ level for lower prices.

    The currency ‘majors’ have not move to a level where they are sending a massage the equity turn is in. This states that we are only at the top high, and wave 1 only down is in place here.

    During this drop coming in, in the INDU will begin to have large ‘major’ currency moves upward, DX lower.

    Have a great day tomorrow Rick.