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Selloff only half-done - final leg in 2019: Morgan Stanley strategist


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#1 dTraderB

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Posted 27 November 2018 - 06:15 PM

Generally agree with this but I am not sure the rest of this year is up. 

2018 has been different in many senses & just as Thanksgiving was not bullish as is the case in most years, it is also 

most likely December will not be as bullish.as previous year. 

For now, the bull soldiers on after the drop during the past 2 month but the market can turn on any news that is even slightly bad. 

 

Stock market’s selloff is only half-done, and final leg will come in 2019, warns Morgan Stanley strategist

Strategist sees the S&P 500 trading at 2,750 in the new year

“The Rolling Bear market is now better understood by the consensus; and more importantly, it is better priced, with forward price/earnings falling 18% from peak to trough. In short, while 90% of the price damage has been done by this bear, we’ve likely only served 50% of the time,” said Mike Wilson, an equity strategist at Morgan Stanley, in a note to clients.

Wilson was among the handful of market watchers to predict the recent market wipeout even as stocks were trading at record levels.

“The Rolling Bear is tired from all the mauling he has done this year. However, he is likely just resting rather than hibernating,” he said. ”The final leg of this bear likely won’t come until numbers are reduced for 2019, although that should feel a lot less painful than the multiple compression stage we experienced in 2018.”

https://www.marketwa...gist-2018-11-27



#2 dTraderB

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Posted 27 November 2018 - 06:20 PM

  Trading guru Bollinger: U.S. stock market just flashed not one, but two, buy signals

MW-GZ089_market_20181126182201_NS.jpg?uu

https://www.marketwa...nals-2018-11-27

 

Opinion: It’s time to sell into rallies, bear market or not

 

https://www.marketwa...-not-2018-11-27


Edited by dTraderB, 27 November 2018 - 06:21 PM.


#3 dTraderB

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Posted 27 November 2018 - 06:23 PM

Trump attacks Fed Chairman Powell: 'I'm not even a little bit happy with my selection of Jay'
  • President Trump renewed his criticism of the Federal Reserve in an interview with The Washington Post.
  • He blamed the central bank and Fed Chair Jerome Powell for the recent market sell-off as well as plant closures and layoffs at General Motors.
  • Powell is scheduled to make a speech Wednesday.

https://www.cnbc.com...ion-of-jay.html



#4 LMF

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Posted 27 November 2018 - 07:43 PM

We get to see next month whether Powell has the guts to hike rates into a death cross on the RUT chart.....even Bernanke could see straight enough not to try that.  The small stocks can easily reflect the real economy, or worse.  Such hikes are ok at the start of a rate hike cycle, as they did on 12-16-15.  But no others going back to 2005.  The Fed needs to be censored from making real projections more than about 30 minutes out after an FOMC announcement is made. That's about how good they are at it.  



#5 dTraderB

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Posted 27 November 2018 - 08:44 PM

Watch that 50ma now trending down and heading towards the 200ma. Most likely, this will cross in early 2019. 

 

The next most obvious target is reclaiming 2,700 support, and the 200dma after that. We are not out of the woods yet and we should expect volatility to stick around. But the swings are getting smaller and the fear of a collapse are dissipating. We currently find ourselves near the lower end of the trading range and are in a place where the market is brushing off bearish headlines. That tells me the near-term path of least resistance is higher. Things will look different after we run up to the 200dma, but we will discuss what comes after that when we get there.

Trump specifically called out Apple when threatening to increase Chinese tariffs to 25%. While that would put a massive hole in AAPL’s earnings, the stock largely shrugged off the news and finished practically flat. That tells us AAPL’s 25% tumble from last month’s highs has already factored in a lot of bad news. If further downside is limited because most of the bad news is already being priced in, that actually makes this a pretty safe time to be buying. While prices could continue slipping, the lower we go, the safer it becomes.

It’s been a while since I wrote about Bitcoin because I’ve been so consistently bearish about it there wasn’t much new to add, but now that prices dipped into the $3k’s, the situation has changed. While I’m still skeptical of Bitcoin’s long-term viability, every collapse includes multiple sharp rallies. Given bitcoins sharp fall, I would rather buy these levels than sell them. It wouldn’t be anything to see prices bounce 25% or 50% from current levels. For the most nimble of traders, that’s good money for a few days of work. The challenge is knowing when we will bounce. Anyone buying the dip better be willing to sit through some dramatic near-term weakness first.

Screen-Shot-2018-11-27-at-6.10.00-PM.png

https://cracked.mark...as-a-great-day/



#6 dTraderB

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Posted 27 November 2018 - 08:48 PM

  Issues   Volume(000s) Advances 1165   1480107 Declines 1835   1903649 Difference -670   -423542 10% Trend -162 . 845 -191127 5% Trend -153 . 122 -190144 McC OSC -9 . 723 -983 PRIOR McC OSC 19 . 424 12557 SUMM Index -443 . 713 -1892596 PRIOR SUMM Index -433 . 990 -189161

 

McClellanOsc_425.gif

 

https://www.mcoscill...t_breadth_data/



#7 dTraderB

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Posted 27 November 2018 - 08:50 PM

Doug Kass' 15 Surprises For 2019

 

https://www.zerohedg...-surprises-2019



#8 dTraderB

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Posted 28 November 2018 - 07:12 AM

Another Downshift Expected For US GDP Growth In Q4

Economic activity for the US appears headed for a second quarterly slowdown in the final three months of this year. The projection is based on a set of nowcasts compiled by The Capital Spectator. The current median estimate: a 2.7% increase in real growth (seasonally adjusted annual rate), which is slightly below the previous outlook published in early November.

gdp.cs_.2018-11-26.png

 

http://www.capitalsp...dp-growth-in-q4



#9 dTraderB

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Posted 28 November 2018 - 09:04 AM

Still bullish but.... not totally committed, somewhat like Phil, see below. 

Ride the rally with the option to bail out and reverse ASAP. No long term commitment and loyalty, just trading 

with the market. 

SPX 2690/2705 is the fat strong resistance zone that must be taken out, a daily close above SPX 2705 is more bullish. 

 

3 NQ trades this morning, 1 short (loss) & 2 longs (profit)

 

 By phil

Posted: November 28, 2018 - 8:15am

Well, we flipped the NYSE's weak bounce line green at 12,150.

We also hit the weak bounce line (24,800) on the Dow (/YM) futures so all is well(ish) at the moment as the Trump administration made nice noises on trade yesterday – essentially negating Trump's morning tirade and that gave us the pop that we needed to get back over the hump so now we are waiting to see if either the S&P (/ES) can take back their weak bounce at 2,710, Nasdaq (/NQ) 7,080 or the Russell (/RTY) 1,530 and, if any of them do – then we can go long on the laggard with tight stops if those weak bounce lines fail again.  

Unfortunately, as you can see from the NYSE chart, recent weakness has already caused a "death cross" to occur as the 50-day moving average fell below the 200-day moving average and we really won't be out of the woods again until that reverses and that will take a couple of months above the 200 dma so, until we cross back over those lines – this market will still have a tendency to trend lower well into Q1 of 2019.

And it's not just the NYSE, the Russell has already crossed and the Nasdaq will cross early next week and the S&P will cross within two weeks and the Dow MIGHT avoid a death cross, but only if it gets back over 25,000 and stays there.  This morning, the /YM Futures are at 24,900 with a 160-point gain on the Dow overnight so it could possibly happen and the best bullish Futures bet at the moment is going to be going long on the Russell (/RTY) above the 1,500 line which will be confirmed by Nasdaq (/NQ) 6,750 and S&P (/ES) 2,700 so as long as all 4 of the indexes are over those lines, you can stay bullish on /RTY 



#10 dTraderB

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Posted 28 November 2018 - 09:55 AM

Will close my QQQ JAN 155 calls, all of them

 

Nice profit, but not hanging around for possibility of more