I'm actually looking forward to earnings season kicking into full gear in about a week. In this market, where the constant threat of more "easing" acts as a permanent source of helium for equities, it's nice to actually get some fundamental data and reality back into the picture, at least to see what's genuinely going on with the companies on which stocks are based.
Zynga is providing a bit of fireworks after hours, since they lost about 20% more of their value, pushing to new lifetime lows. This will yield a drop of about 86% from its high last March, which is, let's face it, pretty stunning. One wonders if Zynga will be around in a year or two.
I backed off my bearish stance somewhat on Thursday, and even (gasp…….) took on some long positions. The market is looking, I'm afraid, disturbingly strong. Unless the jobs report causes some unexpected rip to the downside, it seems to me things are poised for further gains. Here's the NASDAQ Composite:
The Russell 2000 has an even cleaner pattern:
I'm finding the EUR/USD somewhat inscrutable, so I'll offer up the New Zealand cross-rate instead, which seems to have completed a breakout from a symetric triangle (again, with a suggestion of a hearty move higher):
Just to add to the body of evidence, bonds seem poised for a continued tumble.
At the moment, I'm 30% in cash and 70% in positions, and among those, I'm split about 20% bullish and 80% bearish. I have no large positions of any kind.
Friday is the very last chance in the near-term for the bears to have any kind of chance. If we get a post-job pop, the market could well be on a path for continued strength right up through the election.