Elon Musk Acts Like a CEO, and That’s Why Tesla’s a Buy

Tesla recently delivered its quarterly earnings report and the news was pretty much in line with what many analysts had expected. The Wall Street Journal reported, “Tesla more than doubled its loss from last year’s second quarter to $717.5 million, its seventh consecutive quarterly loss during an period intensely focused on ramping up production of the Model 3. Tesla reached the long-delayed goal of making 5,000 Model 3 sedans in a single week during the final days of June. Now the test is whether it can sustain that production to generate necessary cash and eventually prove it is no lo...
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Here’s the Ideal Combination of Technical Indicators to Chart

Technical analysis can benefit or harm an investor. The benefit results from a careful analysis that can help with the buy and sell decision. The harm can come from too much or too little thought about the process. Too much thinking about technical analysis is a problem that is easy to overlook. The problem is that many indicators use the exact same data. For example, the default parameters for both the relative strength indicator (RSI) and the stochastic indicator are both 14 days. Calculations are different, but both use the same time frame to provide trade signals. This is not an ...
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Get Ready Now for the Worst Month of the Year

October is the month many investors fear. That’s the month of market crashes in 1987 and 1989. It’s the month in 1929 when stocks crashed, and the Great Depression began in the mind of many. But, there’s another month to fear more, the only month when stocks are down more often than up. That month is also in the autumn. And, there is a good reason the market crashed so often in the autumn. A Historically Weak Time of the Year Until the modern era, dating to the end of World War II, farmers and monetary policy were the leading cause of autumn crashes. Money was, for many years, stri...
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Here’s What to Expect From Facebook

In many ways, the stock market is nothing more than a large pool of data. That means whenever something happens, even something that appears to be unprecedented, that is almost certainly a precedent. That’s the case with Facebook (Nasdaq: FB). A Bad Earnings Report Becomes a Very Bad Day for the Stock Facebook released its earnings for the second quarter shortly after the market closed last Wednesday. The stock sold off on the report which was not as strong as analysts had come to expect. As the conference call with management began, the stock was off about 10%. The problems began ...
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Market Breadth: A Powerful Tool You Might Not Be Using

  Academics can make almost anything sound boring. FOMO, or the fear of missing out, is often associated with amazing vacation pictures on Instagram or tweets of a life of luxury. But, the concept dates back to a 1990 article by Dr. Dan Herman who explains: “I first observed this phenomenon that I later named "The Fear of Missing Out" in the mid 90's, while listening to consumers at focus groups and during individual in-depths interviews. Despite the variety of research topics and business categories being explored, most consumers expressed - at one time or another –a clearly...
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What Investors Really Need to Know About an Inverted Yield Curve

The biggest risk in the bond market isn’t rising rates or the Fed vs. Trump. It's the inverted yield curve. At least according to the headline on CNBC. Over at The New York Times, it’s a similar story. “What’s the Yield Curve? ‘A Powerful Signal of Recessions’ Has Wall Street’s Attention” Investors are facing a flood of stories about this indicator. But, the truth is the yield curve hasn’t inverted yet. So, we can take some time to learn about what the curve is and what it means. The Yield Curve Shows the Price of Money Some analysts pay attention to the yield curve all of the time...
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This Technical Indicator Tells You Which Technical Indicators to Use

Traders often turn to technical indicators to develop trading strategies. They might use a moving average, the relative strength index (RSI), stochastics or one of the hundreds of other indicators that have been developed over the years. Sometimes, the indicators will work well. At other times, the indicators will be ineffective. To some traders, there appears to be no rhyme or reason as to when to expect an indicator to work. To others, the answer lies in the state of the market. Among the first to delve into this problem was J. Wells Wilder who developed the RSI. He also developed ...
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Bad News in the Employment Report Shows the Bull Market Is Near an End

Good news for the economy continues to appear. The Wall Street Journal noted that “Economists expect the low U.S. unemployment rate to go even lower over the next year, reaching levels not seen in a half-century. Private-sector economic forecasters surveyed in recent days by The Wall Street Journal on average saw the jobless rate—4% in June after touching 3.8% in May—falling to 3.7% by the end of 2018 and 3.6% by mid-2019.” It hasn’t been below that level since December 1969, when it was 3.5%. Source: Federal Reserve Unemployment has rarely been lower than it is now outside of ...
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The Simplest Momentum Indicator Can Be Very Effective

Technical analysts can turn to hundreds, if not thousands, of indicators. Many are designed to measure momentum. Analysts have created these indicators in search of an edge, a tiny advantage that gives them a chance for profits by getting ahead of other traders. Momentum is considered to be the velocity of price changes, in general terms. Technical analysts aren’t trying to say a price is moving at a certain, steady rate, like the velocity of a car. They are trying to determine when the price is moving, or delivering gains in a trending manner, or when a reversal is due. The latter i...
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Oil, Iran and Saudi Arabia

The price of oil is widely followed because oil is critical to economic growth. But, it’s also a chicken and egg type of question. Economic growth drives demand for oil. That raises the price of oil. But, high oil prices choke off economic growth. When oil is priced “just right” we have economic growth. Just right pricing also helps to maintain stability in one of the most volatile regions in the world, the Middle East. Right now, prices are higher than they were a year ago, but they seem to be just right. However, it seems unlikely prices will remain near their current level. The...
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