Monthly Archives: April 2012

Dear New World Investor: Is the current market a tale told by an idiot, signifying nothing? Or are we seeing a long consolidation in response to both very large positive factors (money printing, a still-improving U.S. economy, a possible bottom in housing) and very large negative factors (the endless Euroland crisis, a confusing Chinese economy, early signs of a coming recession)? After the April 2 high and a quick breakdown below 1385, the S&P 500 seems to have gone to sleep. It closed within 1% of its 50-day moving average every day for the last 13 days, until today: Click...

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Dear New World Investor: So far, earnings for the S&P 500 for the March quarter have been mixed. As expected, technology companies generally are reporting a seasonally down sequential quarter, as they usually do, and guiding for a somewhat better June quarter. Our companies don’t really start reporting in large numbers for a week or two, but I expect the same pattern there. The broad market certainly is having trouble with 1385 as a former support level, and now a resistance level. This is a consoloidation move that could last quite a while. The daily fractal dimension started a trend,...

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Dear New World Investor: The news flow about companies gets light during earnings season, and it seems that all that matters are the big issues plus whatever company reported results. The big issues right now are expectations for a soft first quarter across the board and whether Spain will be the next Greece. Those are two of the most “old news” items you will ever see, and should be thoroughly discounted. So as earnings flow and guidance is for a better June quarter (as always), and the European Central Bank lets it be known they are going to backstop Spain...

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