After moving past the halfway point of a week that was supposed to be fraught with event driven volatility, we are looking at an S&P that is up a little more than 1% on the week and an NDX that is up close to 2%. Both averages remain largely range bound, sitting in the same spots they have for the past couple of weeks.
This is a complicated spot for the market. We have various pieces of bullish fundamental information, mostly in the form of earnings and guidance, that have been off the wall positive. These are pieces of information that should have driven the markets out of these ranges. Yet, here we are, midway through the busiest week of a significantly positive earnings season, with the market embracing investors by seemingly saying "earnings are great, I'm sitting in the same spot I have all month, come along for the ride."
There's something I like to call absorption theory, which very simply states that when the market absorbs positive news within a bullish uptrend without moving much at all, the situation has underlying layers of complexity that are yet to be revealed. In other words, markets should never be accommodative in BOTH price and fundamentals.
If fundamentals are good, as they are now, the market should be forcing the chase, creating an uncomfortable buying proposition for investors.
Perhaps after being long since late March, most often upwards of 350% until we lightened up in June, I am being protective of our profits, overthinking things a bit here. I will concede that possibility.
However, at the same time, while being extremely bullish for the months ahead, the markets are more than due for some shenanigans that throw investors off balance. What we are experiencing presently may be the first steps towards the deception to come.
While remaining long primarily technology, both T11 and Zenolytics portfolios have a significant amount of cash to deploy in case of any misbehavior in the offing.
Zenolytics now offers Turning Points Market Intelligence premium service Click here for details.
Disclaimer
This website is for informational purposes only and does not constitute a complete description of our investment advisory services. No information contained on this website constitutes investment advice.
This website should not be considered a solicitation, offer or recommendation for the purchase or sale of any securities or other financial products and services discussed herein. Viewers of this website will not be considered clients of T11 Capital Management LLC just by virtue of access to this website.
T11 Capital Management LLC only conducts business in jurisdictions where licensed, registered, or where an applicable registration exemption or exclusion exists. Information contained herein is not intended for persons in any jurisdiction where such distribution or use would be contrary to the laws or regulations of that jurisdiction, or which would subject T11 Capital Management LLC to any unintended registration requirements. Visitors to this site should not construe any discussion or information contained herein as personalized advice from T11 Capital Management LLC. Visitors should discuss the personal applicability of the specific products, services, strategies, or issues posted herein with a professional advisor of his or her choosing.
Information throughout this site, whether stock quotes, charts, articles, or any other statement or statements regarding capital markets or other financial information, is obtained from sources which we, and our suppliers believe reliable, but we do not warrant or guarantee the timeliness or accuracy of this information. Neither our information providers nor we shall be liable for any errors or inaccuracies, regardless of cause, or the lack of timeliness of, or for any delay or interruption in, the transmission thereof to the user. With respect to information regarding financial performance, nothing on this website should be interpreted as a statement or implication that past results are an indication of future performance.
