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  Wednesday, 22 Jun 2016 | 2:28 PM ET

If you sold in May, JPM says you’ll regret it. Here’s why

Posted ByBrian Price

"Sell in May and go away."

It's a familiar phrase that was coined to describe a trader's decision to put money on the sidelines before heading to the Hamptons or Nantucket.

However, JPMorgan says that taking a vacation from stocks this summer will ultimately be a mistake for investors.

"We've had a couple of tough summers that are fresh in people's memory," said Stephen Parker on CNBC's "Futures Now" on Tuesday. "But, if you look back over the long term, history is not in your favor to sell in May and go away."

The head of thematic equity solutions for JPMorgan Private Bank believes that, even as the S&P 500 has risen 2 percent in the past month, more gains are to be expected. He noted that, since 1970, markets have actually rallied over the summer nearly 67 percent of the time.

However, while Parker warned that the period of time between Memorial Day and Labor Day tends to see more volatility, that can be in favor of bullish investors, since "we've had more 10 percent rallies over the summer than we have had declines."

Furthermore, Parker remains undeterred from the volatility that could stem from a Brexit. Regardless of how the U.K. votes on Thursday, he says that the market is ready because "de-risking" is already baked into investor's strategies.

"We're set up for a potential positive surprise heading into the rest of the summer," said Parker in his coverage. "History shows that market moves leading up to or immediately after some of these binary events often correct rather quickly."

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  Sunday, 19 Jun 2016 | 5:01 PM ET

Brexit vote could cause huge buying opportunity: Wells Fargo

Britain's upcoming referendum on whether to quit the European Union has created considerable market volatility. According to one Wall Street firm, however, investors who panic and sell if the Brexit wins will do so at their own peril.

"If there is an exit vote, you know we want our clients in here stepping in to buy U.S. large-cap stocks," Scott Wren, Wells Fargo Investment Institute's senior global equity strategist, said recently on CNBC's "Futures Now." "After we get finished with the noise and the volatility, after a few weeks of that, you know people will have wished they bought stocks."

Britain will hold a referendum June 23 on whether to leave or remain in the 28-member European Union. British advocates of leaving believe the country is being held back by the political and economic union.

Wells Fargo hasn't issued any official odds on the likelihood of a Brexit. But other firms, such as Morgan Stanley, put the probability just below 50 percent.

"I think that whatever outcome this vote is, it is in no way, shape or form going to change the trajectory of the domestic economy in particular or the international economy over the next 12 to 18 months," he said.

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  Saturday, 18 Jun 2016 | 4:00 PM ET

US economy just 'doesn't want to grow up:' BofA's Contopoulos

BofA: Fed in 'Fantasyland'
BofA: Fed in 'Fantasyland'   

The United States, along with the European Central Bank and Bank of Japan, are stuck overseeing 'Peter Pan' economies that refuse to wean themselves off cheap money policies.

That assessment comes from Bank of America-Merrill Lynch Global Research's head of high yield and relative value strategy, who saidFederal Reservechair Janet Yellen and her global central banking counterparts have been reduced to little more than high ranking babysitters.

"A Peter Pan economy is an economy that just doesn't want to grow up," Michael Contopoulos recently told "Fast Money."The central bankers of the U.S., Japan and Europe "are like three nannies managing the economies. And, that's what they're supposed to be doing.

Speaking about the central banks' mandate for price stability, Contopoulos added: "If you think about it, their job is to spur inflation and growth. It's to baby the economies forward. It's just not happening though."

The analysis coming as the ten-year Treasury note yield fell to multi-year lows this week, breaking the 1.60 percent mark. Meanwhile, the Fed decided leave interest rates unchanged.

"I think rates could go lower. You have ten trillion of negative yielding assets globally. Treasuries, U.S. investment grade and U.S. high-yield are virtually some of the only assets available right now with a positive yield," said Contopoulos, who drives the firm's view on cross assets and the high yield and loan markets. "Fundamentals are weak."

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  Friday, 17 Jun 2016 | 2:17 PM ET

Gold is going to $1,450, and these charts prove it: Technical analyst

Posted ByBrian Price

As gold hit the highest level in nearly two years, one technical analyst is certain that major gains are in store for the precious metal.

"Gold is going to $1,450," Zev Spiro said on "Futures Now" on Thursday, a day on which gold rose as high as $1,318 before retreating back below $1,300. Gold was around $1,296 on Friday afternoon, up about 1.5 percent this week and on pace for its third positive week in a row.


"Once we get to $1,306 to $1,308 and hold, I suspect we can push higher within two to three months."

Spiro looked back to March, when prices moved above what he described as a two-year long descending channel. At that time, "the breakout signaled higher prices with a minimum price objective in the $1,450 area," he said.


He also explained that prices could extend beyond this minimum objective to test the $1,525 to $1,550 area, "which was a level of support from 2011 to 2013, that is now overhead resistance."

Ultimately, Spiro believes the landscape for gold remains positive because of the sell-off in May, when prices tested and held above a key range of $1,190 to $1,205.

"The hold of that support reinforced significance of the $1,190 to $1,205 level and it led to the sharp rally we've seen over the past two weeks," he said, noting that gold prices have rallied nearly 7 percent in June.

Spiro also said gold moved above a key level of resistance that's formed by connecting the highs from January and May, when gold prices surpassed $1,308 and $1,306, respectively.


"If we get a hold above $1,306 to $1,308, that would confirm a breakout above this level, which would be positive and signal a continuation of the larger uptrend," he said.

Spiro also said that in the coming weeks, "digestion" of a rally is healthy, and that there may a brief short-term consolidation before a breakout.


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  Wednesday, 15 Jun 2016 | 11:56 AM ET

The Fed has been mugged by reality: Boockvar

Posted ByBrian Price

For investors anxiously awaiting Wednesday's Fed announcement, Peter Boockvar has a clear message: Your fears are misplaced.

The managing director and chief market analyst at The Lindsey Group explained that a rate hike in June or in July is unlikely. Furthermore, he reasoned that traders should look across the pond to the U.K. if they're in need of reasons to worry.

"The market has tossed the Fed aside," said Boockvar. "They've been mugged by the reality of the global economy continuing to shrink."

The Brexit vote is just eight days away and favorable sentiment toward leaving the European Union continues to grow within the U.K. As it stands, Boockvar described a British departure from the EU as an occurrence that would create a dangerous ripple effect across global markets in the near term.

"If the Brits vote to leave, it can take two years for it to physically happen and so much can happen within that time frame," said Boockvar, who predicted that Italy, Spain and Portugal could also follow the U.K.'s example. From here, he fears that a mass exodus from the EU could trigger a global recession. This belief stems from the notion that the bloc has established rules that do not entice member countries to want to stay.

"Think about the euro. It actually was a great idea. If I'm Italy and you're Spain we can do business," noted Boockvar, who says that ease of conducting commerce in Europe no longer exists because of bureaucracy. "They need to decentralize power out of Brussels and give it more to the individual countries."

He also blamed the European Central Bank for "mucking things up" and racking up serious debt in efforts to establish a one-size-fits-all monetary policy in Europe.

"To me, the ECB is the biggest threat to this whole experiment," said Boockvar, who added that it's near impossible to find a common financial platform for countries like Germany, France, Italy and Greece to operate across.

Additionally, Boockvar remains skeptical of Europe's ability to ease the potential panic on a "leave" vote as he feels that the general public has become repulsed with today's leadership.

"What we're seeing with central banks, our own presidential election, in the U.K., potential in the vote in Spain is disgust with the establishment," said Boockvar, referring to the general election in Spain. Now, with people losing their faith in central banks, he sees monetary policies losing a grip on their ability to maintain calm in the marketplace.

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  Wednesday, 15 Jun 2016 | 7:37 AM ET

An unusual pattern points to more upside in just weeks

The unusual trend which suggests a buying opportunity
The unusual trend which suggests a buying opportunity   

An unusual trend has emerged in the stock market, and there's an 80 percent chance it could lift stocks higher within the next month.

That's the latest call from FBN Securities Chief Market Technician JC O'Hara, based on his tracking of a phenomenon regarding the length in time in between so-called distribution days.

"A key distribution day is when ... there are five times as many decliners as there are advancers — as well as five times as much volume in the declining stocks as in the advancing stocks on the day," O'Hara said Tuesday on CNBC's "Futures Now." "When those two conditions are met, you have what we call a 'distribution day.' So, the markets traded 44 days, that's roughly two months without a distribution. Now, to put those 44 days in perspective, the market typically has a distribution day every nine days. "

While the definition is highly technical, the gist is that a distribution day is a session in which it appears that large holders of stock are selling. Those who track them believe that they lend insight into what large investors are doing, which could inform how the market is likely to behave.

After that long 44-day dry spell, an interesting thing happened. The S&P 500 saw two distribution days in a row on Friday and Monday.

"We went back in history and said what happens if you go two months without a distribution day, we have back-to-back distribution days — how does the market react?" he asked.

The answer: a short-term drop followed by intermediate-term gains.

O'Hara, who calls himself bullish, says it's important to watch how the bulls react to any potential pullbacks — since it's been a relatively easy ride for them over the past three months.

If the bulls are resilient and bounce back quickly, then it's a sign that the markets are in a very strong place, he said.

He predicts the S&P 500 could move 6.5 percent higher within a month, putting the index at 2,200.


»Read more
  Sunday, 12 Jun 2016 | 5:00 PM ET

Is $10,000 gold on the horizon? Why one top market watcher says 'yes'

Posted ByBrian Price

As gold continues to rally in 2016, one of Wall Street's most closely followed commodities watchers says we could be in the early days of a historic rally for the precious metal.

However, the catalyst for gold's gains could stem from a nerve-wracking sequence of events.

"We should expect the next global financial panic soon," said Jim Rickards on CNBC's "Futures Now" last week. "We have imploded twice in the last 16 years so get ready for the third one."

Rickards has penned numerous New York Times best sellers on the relationship between commodities and currencies. His latest book, "The New Case for Gold," defends the rationale that gold always has been, and always will be, a true safe haven during volatile times. He therefore urges investors to think of the commodity as insurance, not an investment.

He cited the financial meltdown of 2008, where U.S. banks teetered on the brink of collapse before the government's multi-billion dollar bailout. Before that, in 1998, Wall Street bailed out Long-Term Capital Management when it collapsed.

Rickards explained that, given the consistency of a financial panic every 10 years, investors should brace for another disaster in 2018. Yet, this time around, Rickards believes that its the U.S. government itself that may trigger the next crisis.

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  Thursday, 9 Jun 2016 | 2:06 PM ET

Everything is near a critical level and that makes me nervous: Trader

Posted ByAmanda Diaz

Gold, crude, stocks and bonds are rallying in lockstep, and that has created a very tricky trading environment, according to one market watcher.

"I don't think any of this is easy to trade here," Scott Nations told CNBC's "Futures Now" on Thursday. "Everything seems to be tied to the dollar."

Nations said that while the stock market is tethered to a lesser degree to the dollar, oil remains a main driver for equities. "That means there's no way to pick out a unique setup that is moving on fundamentals and has some technical momentum we can take advantage of."

The market has seen explosive moves across many asset classes of late. In the last three weeks the S&P 500 gained more than 4 percent and climbed within a hair of its all-time high, while crude oil is up 7 percent in the same period, steadily trading above $50 for the first time since last July. These moves coupled with gold soaring more than 5 percent since the start of June and Treasurys sitting near year-to-date highs has Nations taking a second glance at the market.

"The fact that nearly everything is at or near a critical level" makes it difficult to trade, said the founder of NationsShares and a CNBC contributor. "It makes it like a coin flip, an expensive coin flip."

As a result of the unpredictability, Nations said he is reducing his positions and closing lower conviction trades right now.

»Read more
  Wednesday, 8 Jun 2016 | 7:00 AM ET

Fund manager’s warning to traders: You’re getting the Fed all wrong

The market is getting the timing of the Fed rate hike wrong, and it could deliver a big blow to stocks, according to one hedge fund manager who's turned negative on the markets.

"The Fed funds futures are pricing in less than a 40 percent probability of a hike by the September meeting. and only a 59 percent probability of a hike this year," Matarin Capital co-founder and hedge fund manager Nili Gilbert said recently on CNBC's "Futures Now. "That is a pretty low probability given what we are seeing with a rebound in cyclicals, materials and energy."

Wall Street firms BNP Paribas and IHS Global Insight predict that a rate hike won't happen until late this year at the earliest. But while there's a markedly low chance it will happen at next week's Federal Reserve meeting, Gilbert makes the case the markets will see one as early as July.

"We actually think that the Fed may be more likely to raise rates this year than what is currently being discounted in the market, and that's because we believe that future inflation may make it increasingly difficult for monetary policy in the U.S. to remain as accommodative as it is today," she said.

Gilbert's firm, which has $740 million in assets under management, has a long/short strategies fund that claims the ability to navigate "any market," and a separate futures portfolio.

Two years ago, Gilbert was bullish on stocks — a good call. Since then, the S&P 500 gained more than 8 percent and the Nasdaq has surged 15 percent.

Now she's cautious and holding a large cash position.

"Our stock market outlook is somewhat negative for most countries, and that's because we expect that if the Fed has to increase rates earlier or more than what is expected, then it's going to be quite a negative surprise," she said.

The other major element she's watching: Whether Britain will decide to leave the European Union.

"The markets really haven't priced in much of a probability of Brexit," said Gilbert. "If there were a Brexit in the near term, there would certainly be a lot of uncertainty, a lot of volatility, and that just doesn't seem to be priced into the markets right now. So it could be very unsettling."

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  Sunday, 5 Jun 2016 | 5:01 PM ET

Time to get nervous—the Fed painted itself into a corner: Saxo Bank CIO

The Federal Reserve may be in a box when it comes to conducting monetary policy — a scenario likely exacerbated by disappointing jobs report numbers released last week.

Just 38,000 jobs were added to U.S. payrolls in May, the weakest performance in nearly six years. The data stoked new fears about the economy's health, and threw cold water on the Fed's recent hints at higher rates in the coming months.

"Friday's data again pushes back decisions," said Saxo Bank chief economist and chief investment officer Steen Jakobsen told CNBC recently. "The ability of the Fed to move now is almost entirely based on their 'need' or 'want.'"

Late last month, Fed chief Janet Yellen said in a speech that an interest rate hike was "appropriate" in the near term, and could rise gradually. With that in mind, Jakobsen argued the Fed has painted itself into a corner, as well as other central banks around the world.

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