Tag Archives: NWS
What took you so long? We’ve been waiting a week or two for stock prices to enter their “summer siesta” – and with today’s sharp pullback, siesta season may almost be here. Several of our intermediate-term indicators, which typically look at the market through a three-month window, are now threatening to turn down from severely overbought levels. It may take another day or two for the final top to be put in place, but we definitely expect lower prices by mid-August.
A crack in the armor! If you’ve been following these Hotlines the past few weeks, you know we’ve been expecting a dip in the stock market before the major indexes reach a temporary summer high. Well, Mr. Market sometimes takes longer than expected to do what he’s supposed to, but we finally got that pullback yesterday and today.
Still waiting for the dip! Stock prices ambled sideways this week, extending the narrow trading range we’ve now seen for the past three weeks. In fact, the average daily percent change in the S&P index over the past 15 days has been the smallest since the Christmas-New Year’s lull.
A dip, then another rally! Stock prices marked time during this holiday-shortened week, with all the major indexes closing slightly lower. But so far, we’ve seen nothing to derail the rally that began in late April. In fact, a couple of down days in the coming week could energize the bull again and take us up to new highs for the year by late June or early July.
This month, I’ll show you how to make the smartest use of any further “down time” Mr. Market may grant us in the next few weeks. More and more bargains are turning up on my radar screen, including a brand-new name for us: one of the world’s largest and best-run management-consulting firms, now at a whopping 50% discount to my estimated share price three to four years out. Yet I’ll bet you’ve never heard of the stock. (There’s a curious reason why.)
We’ll take it! Stock prices climbed further this week in the run-up to the Memorial Day break. Technology stocks, in particular, continued to outperform the overall market�always a good sign, because it suggests that investors are feeling more comfortable with the economic outlook.
It’s the real thing! Finally, this week, stocks broke out of their funk and staged the decisive upside reversal we’ve been waiting for. Even the mild profit taking in today’s session fits the pattern perfectly. As we predicted last week, the base building is now complete and we look forward to a brisk rally lasting into mid-summer.