• Subscribe
  • Log In
  • Home
  • Daily Diary
  • Asset Class
    • U.S. Equity
    • Fixed Income
    • Global Equity
    • Commodities
    • Currencies
  • Sector
    • Basic Materials
    • Consumer Discretionary
    • Consumer Staples
    • Energy
    • Financial Services
    • Healthcare
    • Industrials
    • Real Estate
    • Technology
    • Telecom Services
    • Transportation
    • Utilities
  • Latest
    • Articles
    • Video
    • Columnist Conversations
    • Best Ideas
    • Stock of the Day
  • Street Notes
  • Authors
    • Bruce Kamich
    • Doug Kass
    • Jim "Rev Shark" DePorre
    • Helene Meisler
    • Jonathan Heller
    • - See All -
  • Options
  • RMPIA
  • Switch Product
    • Action Alerts PLUS
    • Quant Ratings
    • Real Money
    • Real Money Pro
    • Retirement
    • Stocks Under $10
    • TheStreet
    • Top Stocks
    • TheStreet Smarts
  1. Home
  2. / Investing

How Much Longer Can This Action Persist?

One explanation is that there is a 'climbing a wall of worry' dynamic at work.
By JAMES "REV SHARK" DEPORRE
Feb 10, 2020 | 10:52 AM EST
Stocks quotes in this article: MSFT, AMZN, CHRS, SDC

The most interesting thing about the stock market right now is the disconnect between price action and news flow. Despite the continuous headlines about the coronavirus, the market acts like it doesn't have a worry in the world. There is no fear or worry but there doesn't seem to be any emotion either. The action has the feel of extreme complacency with the bulls feeling mildly positive but not very trusting.

One explanation for this action is that there is a 'climbing a wall of worry' dynamic at work. This happens when there is an obvious negative - such as the coronavirus - but the market doesn't see a negative reaction. The folks with idle cash see the strength, fear that they are missing out, and inch into the market. That additional buying causes the indices to move higher which causes more worry about being left out and the cycle continues.

This is the triumph of price action over fundamentals and news, and is a good illustration of why experienced trades focus on price action rather than arguments about why the market isn't doing what it should do based on news and other factors.

The billion-dollar question is how much longer can this action persist. The answer is longer than most people expect. There is no easy way to guess when this dynamic may come to any edge.

Microsoft (MSFT) , Amazon (AMZN) and big cap names are leading as this action is primarily index driven here.

I'm trying my best to run with the bulls but putting money to work is a challenge. My Stock of the Week is Coherus BioSciences (CHRS) and it's off to a good start. My prior Stock of the Week, SmileDirectClub (SDC) is doing well also. Entry points require some chasing but the alternative is cash and that is paying much.

(Microsoft and Amazon are holdings in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells these stocks? Learn more now.)

Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.

At the time of publication, James "Rev Shark" DePorre was Long CHRS, SDC.

TAGS: Investing | Markets | Stocks | Trading

More from Investing

You Know What They Say About Dull Markets ...

James "Rev Shark" DePorre
Aug 18, 2022 4:37 PM EDT

Don't short 'em. Let's look at how investors responded to the thin trading and lack of big news -- and what we can expect to come.

With Oil, Keep Your Eyes on the Prize by Focusing on Supply

Jim Collins
Aug 18, 2022 3:59 PM EDT

The earth's oil supply is only going in one direction -- down -- and here's what that means for investors.

I Dislike Blue Apron But Here's a Trade, No Strings Attached

Mark Sebastian
Aug 18, 2022 2:30 PM EDT

The company is never going to make money and is likely heading back below $3 a share.

Europe's Recession Is All About Gas

Maleeha Bengali
Aug 18, 2022 1:30 PM EDT

Prices could very well stay elevated for a long time despite the economy going into a manufacturing recession.

The VIX and SPIKES Have Similarities, But There Are Meaningful Differences

Mark Abssy
Aug 18, 2022 12:00 PM EDT

And if you feel that volatility is an asset class that has a place in your strategy there are 2 funds that may be worth a closer look.

Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation. If you have questions, please contact us here.

Email

CANCEL
SUBMIT

Email sent

Thank you, your email to has been sent successfully.

DONE

Oops!

We're sorry. There was a problem trying to send your email to .
Please contact customer support to let us know.

DONE

Please Join or Log In to Email Our Authors.

Email Real Money's Wall Street Pros for further analysis and insight

Already a Subscriber? Login

Columnist Conversation

  • 02:23 PM EDT STEPHEN GUILFOYLE

    We're Cleaning Out This Retailer From the Bullpen

    Check out the latest moves in TheStreet's Stocks U...
  • 10:24 AM EDT JAMES "REV SHARK" DEPORRE

    This Weekend on Real Money

    To Improve Your Trading and Investing, Spend More ...
  • 08:44 AM EDT PETER TCHIR

    CPI Beats Expectations, But Maybe Not the 'Whisper'?

    Slightly better-than-expected inflation across the...
  • See More

COLUMNIST TWEETS

  • A Twitter List by realmoney
About Privacy Terms of Use

© 1996-2022 TheStreet, Inc., 225 Liberty Street, 27th Floor, New York, NY 10281

Need Help? Contact Customer Service

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data & Company fundamental data provided by FactSet. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by FactSet Digital Solutions Group.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

FactSet calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.

Compare Brokers

Please Join or Log In to manage and receive alerts.

Follow Real Money's Wall Street Pros to receive real-time investing alerts

Already a Subscriber? Login