Monday, July 8th, 2019
Indices: US stocks were lower in today’s session with the Dow Jones Industrial Average falling 116 points or 0.43%. The Russell 2000 was the weakest of the major indices, falling 0.90%.
Sectors: Real Estate led, gaining 0.37%. Materials lagged, falling 1.15%.
Commodities: Crude Oil futures rose 0.26% to $57.66 per barrel. Gold futures were slightly lower by 0.16% to settle at $1,398 per ounce.
Currencies: The US Dollar Index gained 0.08%.
Interest Rates: The US 10-year Treasury yield moved higher to 2.048%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
Today’s chart of the day was shared on Twitter by Stefan Cheplick (@scheplick). It’s a line chart showing the dismal performance of Deutsche Bank’s stock ($DB) since 2007. In that time, shares of Germany’s largest bank went from over $130, to where they sit now at around $7.50. The tweet ushered in a comical response of other terrible looking charts of stocks that have fallen precipitously such as $GPRO and $XIV. One of the first things you’re taught in trading/investing is “buy low and sell high.” While this is true, it causes people to hunt for beaten down names in hopes that they’ll return to prior levels. These names are often in clear downtrends like $DB and folks are left scratching their head when price continues lower in the direction of the trend. This chart echoes common market aphorisms like; “Don’t fight the trend” or “Never catch a falling knife.” Charts like this one serve as a good example of the dangers of bottom fishing. Check out the full thread for a few lessons and laughs.
Quote of The Day
“You can’t be afraid to fail. It’s the only way you succeed – you’re not gonna succeed all the time, and I know that.”
– LeBron James (Professional Basketball Player)
In this week’s Chart of the Week column, we take a look at the Aerospace & Defense industry group. We include a ratio chart that illustrates how the group has outperformed the broader market.
Takeaways from 119 Years of Volatility History – Thrasher Analytics
Here’s a piece from volatility expert, Andrew Thrasher. He summarizes the key takeaways from a recent study that looked at 119 years of stock market data to conclude that volatility isn’t exactly caused by economic fundamentals.
Bet on this Dow Laggard as a Second-half Play: Technical Analyst – CNBC
In this clip from CNBC, Mark Newton offers up two Dow components that he thinks will do well in the second half of the year, UnitedHealth ($UNH) and Goldman Sachs ($GS).
Sentiment Slowly Recovering – Bespoke
In this note, Bespoke analyzes the latest AAII sentiment survey. They point out that bullish sentiment has improved over the past few weeks, but it’s still relatively low considering that the S&P 500 is at all-time highs.
Momentum Monday – Don’t Look Down – Howard Lindzon
Here’s Howard Lindzon’s weekly Momentum Monday video. He and Ivanhoff discuss their favorite stocks and trends that they’re seeing in the market right now.
Top 10 Tweets
Dow Theory Update, Part II: Last week the DJ Industrial Average registered a new all-time closing high – that's the good news; but, the bad news is that the DJ Transportation Average failed to register a new closing high. Thus, the Dow Theory is still in primary bear market mode.
— Ralph Acampora CMT (@Ralph_Acampora) July 8, 2019
Classic Dow theory bearish divergence 👀
— I. Vodenitcharov CFA CMT (@iv_technicals) July 8, 2019
The S&P 500 Index remains close to its all-time reached last Friday, but the S&P 600 small cap index is still 13% of its high. pic.twitter.com/wZ5ub1lndZ
— jeroen blokland (@jsblokland) July 8, 2019
MSCI Word Index – Bullish Continuation Pattern? pic.twitter.com/KcVojj2uJ9
— Nautilus Research (@NautilusCap) July 8, 2019
Financials are firming with more issues above their respective 200-day average than at any point over the last 16 months. pic.twitter.com/ToaXVWSrG6
— Strategas (@StrategasRP) July 8, 2019
— David Brady (@GlobalProTrader) July 8, 2019
Although I know next to nothing about interest rates, this looks like a pretty impressive reversal bar on the weekly chart. pic.twitter.com/BNci2cyNKw
— Walter Deemer (@WalterDeemer) July 8, 2019
— Jack Damn (@JackDamn) July 8, 2019
— Arun S. CFA CMT🧐 (@FusionptCapital) July 8, 2019