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Weekly Market Assessment
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Back In the Black

Weekly Market Assessment
By:
 
Just like that, we're back in the black! What a difference a week makes. Putting risk on paid off, even in the face of the terrorist attacks in Pairs, that should have put the markets in defense mode. However, markets rallied across the globe in what many call a patriotic rally. Going from the worst week in over three months to having one of the best weeks in a year can make understanding the market even more difficult as at times it seems very irrational.

What Goes Up Must Come Down

Weekly Market Assessment
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What goes up must come down! What was an unbelievable rally in the market in October seems to have reached a point of exhaustion. After hitting the lows in August and rallying all the way back to even for the year, we seem to have reached a short term peak in the market. The culprit for making this week one of the worst in just under three months...the good ole Federal Reserve! Of course the on again, off again remarks along with market data that suggest that they may be a December rate hike has the market worrying that it "may" happen this time.

Let the Jawboning Begin!

Weekly Market Assessment
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Let the jawboning begin! Just one week after making the decision to keep rates low, Janet Yellen said in a lecture at UMASS that "it would likely be appropriate to raise rates from near zero, sometime later this year, though the decision would continue to rely on economic data." Well how can we go from being solely data dependent to now just saying rates could raise in a short few months. I believe "they" the Federal Reserve have again resulted to verbally telling the market what may happen and looking to see how the market will react.

Well well well...

Weekly Market Assessment
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Well well well, to no surprise the Federal Reserve decided not to raise rates on Thursday. Their reason, none other then what I have been saying so many times before, they are struggling to create inflation.  They have now extended their date to reach their inflation target to 2018! Now, that doesn't mean that they will not raise rates until then but once we have some signs that inflation is improving, could give them the confidence to make the move and raise rates.

Tell If You Have Heard This One Before...

Weekly Market Assessment
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Tell me if you have heard this one before... "Increase in inflation rates seen materializing slower than expected." Last Thursday we heard from the ECB (European Central Bank) President Mario Draghi. He reiterated his concerns of inflation and how they are not meeting the Governing Council's mandate of price stability, or in layman's terms, a low inflation rate. We have heard this same tone from our Central Banks President Janet Yellen.

Only Market Where Customers Run When Things Are On Sale

Weekly Market Assessment
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The stock market is the only market where things go on sale and all the customers run out of the store. Thanks Ro!  Last Monday, the selloff from Friday continued however in a more severe dropoff to say the least.  I woke up to the DOW futures being down over 1,000 points. Absolutely insane! I was a buyer in the early morning as Apple, Netflix, and JP Morgan were all down over 15%. I was looking to buy the best of breed companies that everyone wants but haven't had a chance to get them at the right price.

The Bid finally Comes but is Quickly Gone

Weekly Market Assessment
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Just like that, we catch a bid! Well, for two days we did... and now we are in a major selloff. Welcome to life in the market... where uncertainty, paradoxes and contradictions make trying to understand it nearly impossible.  Today, all markets are very much correlated.  When our market sells off, questions like... Is this just a coincidental correction or is it the beginning of something bigger? Are we heading into a recession or deflationary environment?

Can't Catch A Bid

Weekly Market Assessment
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The market can't catch a bid! Over the past six trading sessions the market has been in the red and this hasn't happened since last October. We are down over 800+ points since May and getting close to a 5% correction. However there seems to be no real sense of fear and panic. The fear index or VIX is trading below 15 which signals to me calm in the market. While the 10 year Treasury Bond trades above 2.25% and Gold continues to trade at multiple year lows, all of these are not screaming, "get out of the equity market!

Never Short a Dull Market

Weekly Market Assessment
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The saying goes, never short a dull market. The past two weeks have been full of extreme moves up but then again, extreme moves down. We contentedly see the DOW open over 200 points, only to watch a slow steady death of all those gains. The same holds true with harsh negative opens that creep up to end the day in positive territory! These huge reversals, of course, happen at the 200 day moving average. This moving average is used by almost every investor for market sentiment and overall strength.

Mark My words "Its Not Going to Happen!"

Weekly Market Assessment
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It's not going to happen! Federal Reserve raising rates is mentioned what seems like every minute. Will it happen? How will it effect the market? If they do it, it will be so incremental that it may have little to no effect on the market. Similar to the buildup to ending of QE (Quantitative Easing) everyone thought that would be the end of the bull market. However, that has come and gone and it seems like myself along with everyone else has totally forgotten about the predictions people made about how devastating it would be once the punch bowl got taken away.