The stock market seemed to change its personality in May.
I attempted to ride a breakout to the upside in Yelp (YELP). I bought a large position and then China numbers brought down the market and it brought YELP’s stock along with it, handing me a loss. I will attempt to cut the losses quickly if I am able. YELP is still very interesting to me here as it remains on a medium term uptrend.
Since the day of the China numbers announcement I have become more cautious and attentive to the large whips in the market.
Brazil and Mexican stocks I follow have been losing ground for a while now and there is just a little bit of lift in some Chinese stocks.
I will here focus on the recent fall in commodities. If they fall gently and find a bottom soon, this can be good for the markets; if they crash, this indicates serious economic conditions worldwide. I expect major trends in many stocks to come because of the moves in commodities and so I am waiting for trend changes to ride.
Gold continues to drop and the gold bugs keep defending the case to buy. Personally, I just see the trend as down. There can be thousands of reasons we do not know about that are causing gold’s price to fall.
Who is to say, for example, that platinum or another metal can’t become the new favored jewelry, bringing the price of gold down for a decade? I will leave the predictions to the fortune tellers.
I apologize for the late report and I feel it is better to give a clear report than to rush it when things are a bit cloudy, as they were at the end of May and beginning of June. Right now the U.S. stock market appears to be resting after a long term breakout for many large cap stocks.
The investments discussed are held in client accounts as of May 31, 2013. These investments may or may not be currently held in client accounts. The reader should not assume that any investments identified were or will be profitable or that any investment recommendations or investment decisions we make in the future will be profitable.
The post The ties that bind commodities and stocks appeared first on Smarter Investing
Covestor Ltd. is a registered investment advisor. Covestor licenses investment strategies from its Model Managers to establish investment models. The commentary here is provided as general and impersonal information and should not be construed as recommendations or advice. Information from Model Managers and third-party sources deemed to be reliable but not guaranteed. Past performance is no guarantee of future results. Transaction histories for Covestor models available upon request. Additional important disclosures available at http://site.covestor.com/help/disclosures. For information about Covestor and its services, go to http://covestor.com or contact Covestor Client Services at (866) 825-3005, x703.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV