We are almost running out of things to say…almost.
A quick glance shows the NYSE where is was 10 months ago…the TRANSPORTS where they were 6 months ago…the S&P 4 months ago…with the better action in the NASDAQ,NDX and for a change, the small caps. It just remains a very split tape with not much changing.
The media is finally coming around to our thoughts on BIOTECH! http://www.wsj.com/articles/biotechs-rally-fuels-bubble-fears-1427237279
We simply believe the 2nd biggest bubble is in this area. #1 is reserved for the rigged and manipulated bond markets around the globe. But even this article did not mention where the bubble is in biotech and that’s in the “no sales” IPOs that have come public and continue to come public. Any announcement sends these companies higher whether it is phase 1 trials. We do not think the music has stopped yet and may not stop for a while…but stay tuned.
Investor’s Edge: 03/24/2015
With the indices doing nothing yesterday, we just wanted to highlight an area that we have been somewhat bearish on that just may have turned into just plain bearish. When you have a moment, time to check out the RAILS. KSU was yonked off of a cutting of guidance. This news and movement impacted the rest of the group as NSC, UNP and others took a hit. At the very least, in this market where over 40% of the market remains in poor shape, we would avoid this group for now and review positions.
On another note, the strong BIOTECHS finally pulled in after a froth week but to our eye, just looked to be extended and in need of pullbacks. Remember, this is the bubble area as over 130 IPOs have come public with NO SALES.
Investor’s Edge: 03/23/2015
We have been telling you for ages that markets are on a central bank-induced asset party. Nothing has changed. Mrs. Bubble teased away with “patience”…”no patience”…”data dependant” and a whole load of bullcrap. The bottom line is that Janet is not going to raise rates unless the markets force her to and so far, markets have done nothing wrong. And now you have Japan and Europe in a race to see who can print the most bucks. As the euro and yen have crashed, their markets have soared. Add in China easing and negative rates in many areas and the juices still flow. Without naming names, a respected hedge dude believes we could see some 1999ish activity as greed and noise picks up. We are seeing some of it in the biotechs as we have reported to you the valuation nonsense that is going on there.
Small caps and mid-caps have edged out to new highs with other major indices getting close. It still remains a 60-40 market as the bear market areas remain just that…bearish. But with the recent counter-trend rally in the euro, those areas have bounced. We will need to see more before calling real bottoms in those areas. They include Energy, oil& gas and the rest of commodity land.
We now enter end-of-quarter window dressing where nothing bad ever happens. Of course, window dressing is illegal so it really doesn’t happen.
The best bullish areas continue to be biotech, healthcare, medical, managed care, semiconductors and retail of many stripes including department stores, discounters, home improvement, restaurants, apparel and drug stores