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March 18, 2020
Stocks – none
Macro – Spy, IWM
It certainly was another horrible day. It seems like these are endless. Every time it looks like the signs are improving, days like today happen. I’m left feeling unsure where the bottom is. We managed to fall to 2,273 today, before finding a bounce. Will that level hold, it is hard to say at this point. The end of day run-up was nice and left us all feeling good, but I can’t imagine at this point we can get out of this without testing the lows.
The market fell right through the December 2018 low as if were nothing, and perhaps that was the most unsettling part, but then by days, it rose through that level like nothing. Very confusing trading action. Nothing makes sense anymore.
Meanwhile, the RSI is now flatlining, and that gives me less confidence in the trend.
The VIX also remains well over 70 and indicates that it is still too much fear out there. The fact that VIX can’t break is concerning.
My biggest worry, though, maybe this chart, as of today, we broke the what is the last 2009 bull uptrend left, that I could map out. I can’t find anymore after this, and the RSI snapped today on the monthly chart.
The RSI hasn’t been oversold on a monthly basis since 2009. So there you have it. Now you know why I was so dire about the 2018 lows holdings, and why I was so desperately looking for signs of a bottom. Perhaps today will prove to be a bottom; perhaps it won’t. I don’t know. If it isn’t the bottom, then what is stopping this market from falling to 1,812 the 2016 lows. That is where the Russell is trading right now, it is down almost 45% since the middle of January! That is insane!
Things will pass, and they will get better, history has taught us that. How long it takes, and how rocky it will be, I don’t know. Just remember, there is no right or wrong answer in investing; everyone is different; the only thing that matters is what lets you sleep at night and not worry.
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This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
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