Holiday week!

To be blunt, we have been at this for a good long time, but the central bank-induced action we have been seeing as of late pretty much wins some sort of a championship belt. These v-shaped moves based on printed money, easing money and non action continue to trump all. This past week, it was the ECB announcing a trillion at the same time our Fed announces nothing…which means our thoughts remain the same; they will never raise rates and in fact, we believe the next move will be QE4…which will be based on any market correction of consequence or a blip in our fake economic numbers.

That all said, we are in another outlier v-shaped move. The hope is a settling down in here to build some sort of base until another move higher into the positive seasonality of year end. But market doesn’t give a — about what we want.

We are most asked about energy stocks. Last week, they finally had a decent rally. Just be careful. Energy remains in a bear market. To our eye, it looks just like a stretched, extended and oversold rally into the declining 50 day average. Nothing more just yet.

We are also being asked about small caps as they have lagged forever. We suspect there may be some sort of “January effect” but a quick glance at the Russell continues to show relative underperformance.

Market should quiet down by tomorrow as we enter the holiday week but everything counts.