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Posts Tagged ‘Adult Swim only’

DJIA Chart: Classic ‘Head and Shoulders’

Posted by Larry Doyle on August 11th, 2011 9:01 AM |

Recent market volatility is clearly unnerving.

I believe the volatility is exacerbated by the general decline in broad based participation in the markets over the last few years. Additionally, the growth in derivatives, both within the equity and fixed income markets, has served to accentuate the swings.

I described these swings and the accompanying spike in volatility as the equivalent of an Adult Swim Only a few days ago when I wrote, What Caused the Market Meltdown?.

What are the implications for a market in which there is a lack of broad based participation?

To an ever increasing extent, professional traders study the charts and perform technical analysis to determine likely levels of support and resistance.

On that note, let’s navigate and review a chart of the Dow Jones Industrial Average which takes us back 5 years and provides a fabulous view of the recent cliff dive along our market landscape. (more…)

What Caused the Market Meltdown?

Posted by Larry Doyle on August 4th, 2011 5:08 PM |

Everybody out of the pool” and “Adult Swim Only” are phrases that ring in my ear from my trading days at Bear Stearns. A long lost friend (God bless you, buddy!!) would bellow those statements when markets plunged like today.

What has recently drained the liquidity and lowered the water level in our equity market ‘pool’?

A number of critically important factors have been building and continue to haunt us.These include:

1. Meltdown in European sovereign debt. This is not and should not be a surprise. The meltdown was merely a matter of time. The outstanding question remains the depth and breadth of the meltdown. Stay tuned as risks remain very high.

2. The dysfunction in Washington truly displayed how screwed up our political dynamic is while shedding light on the enormity of our national debt and deficit. This reality is not changing anytime soon. Stay tuned as risks remain very high.

(more…)






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