Sunday, December 23, 2012
Saturday, December 8, 2012
Saturday, November 17, 2012
Thursday, November 15, 2012
Sunday, November 4, 2012
Saturday, October 20, 2012
Saturday, October 13, 2012
For this technical reason one might objectively identify as their being a potential bullish case in stocks right now. And should this analysis be applied to the basis that 'the fundamentals always find a way to fulfill the technicals,' then it gives even more reason to ‘dig’ into what might be the primary driver.
For starters, price action during the month of September was largely ignited by investors’ response to the stimulus measures of our Federal Reserve. Not only was there a great deal of ‘front running’ the announcement of QE3, but as it turns out, the actual announcement was a ‘sell on the news’ type of event.
Since the market has not ‘taken off’ as it seemingly should by now, there is somewhat of a dismissive approach among investors- as if money printing this time around may not ‘work’. Historical evidence would prove that monetary stimulus during the latter stages of a bull market cycle has less desirable effects, but for reasons explained in the premium newsletter- I believe there is STILL enough 'kick' in this market to accomodate a year-end/election rally prior to a major TOP.
Saturday, October 6, 2012
Sunday, September 30, 2012
Sunday, September 23, 2012
Monday, September 17, 2012
Wednesday, September 12, 2012
Either way, I do not expect this deeply oversold condition to at all be making any accommodations for QE3 tomorrow, or anytime soon for that matter.
Friday, September 7, 2012
Thursday, September 6, 2012
Saturday, August 4, 2012
Saturday, July 14, 2012
Get ready Folks, as this upcoming event will be a force not to reckon with, and for those who deny such could suffer major losses in their investment portfolio.
You might recall in my last post, "Are we to Blame Nixon," I specifically warned readers to stay away from an imminent short covering rally that would emerge, but not to give credence to its illusion of a renewed uptrend.
Unlike most short covering rallies, this one has been all but convincing. It fell short of fullfilling the reek of euphoria in the marketplace, and barely neutralized the negative senitment that engendered during the previous decline in May.
The market is now on the verge of resuming its bearish downward momentum, and the reacceleration of this current decline will categorically be one of much greater magnitude. Stocks will undergo an aggressive sell-off that generates fear and anxiety among investors of every description. This liquidation process will lead to capitulation, where neither buyers nor sellers desire to participate in the marketplace.
My best guess is that this momentary spark in equities will soon fizzle out and stocks find their breaking point sometime between now and the next 10-12 trading sessions. This scenario should materialize in a crawling-like descent, much like the one last week, followed by a 3-5 day mass exodus.
Saturday, May 26, 2012
There is still plenty more downside left of this market, which is why I'm telling you not to believe this current rally. It is simply a contra-trend within a larger decline, but only for the intermediate term.
What do I mean by that? While there are those per-ma bears who feel we are doomed for a deflationary environment, and on this basis, prices will likely head south to retest the march 09' lows. Folks, there is still plenty of evidence that suggests this is only a mild correction within a larger bull market.
Here are several things to consider....
Ever since President Richard Nixon eliminated the gold standard, the value of money is determined by a basket of currencies. This means the value of our dollar is at the mercy of central banks, and believe me, their priorities are to pay back sovereign nations with cheaper money. This will alleviate them from their enormous debt obligation, but also achieving something much worse- destroy the purchasing power of your bottom line wealth.
The Federal Reserve has made it clear that they will do whatever it takes to avoid another 08' collapse, and now more than ever are firewalls in place to prevent such from happening.
Think about it. For the past year the Market has been masking several dramatic developments that could have, and should have led to catastrophic consequences. They were- the bankruptcy of M.F. Global, J.P. Morgan's announcement of a $2 billion dollar loss on risky credit derivative bets, and the growing magnitude of Europe's economic contraction. Yet the market shrugged it off like a bad case of flees.
And I should also mention that only a handful of Market Indices in the entire world have managed to decisively clear above their previous 2011 highs. I'll give you a hint, they all trade in the United States. Why do you think that is?
You see, the U.S. dollar still holds the World Reserve Currency status, and by default, is considered a safe haven to other international currencies. For this reason, citizens of Europe have been taking money out of their home land (real estate, banks, European stock market, etc.) only to re-allocate these funds where the return on investment has a more promising outlook.
We are beginning to see the early stages of this process come into fruition. However, the question that remains is where exactly will all this money go? It can't all go into the Dollar, nor can it all go into gold. It will spread throughout every asset class of the Stock Market , and consequently, re-inflate stocks and commodities to new all time highs.
Wednesday, May 2, 2012
If I must say, last week was full of distractions. Obviously the first, Apple's remarkable quarter was a surprise to many, especially given the five day sell-off prior to the actual news release. This outcome provided investors with relief, and the reassurance of knowing this bellwether did not actually stumble, but instead just underwent a retracement. Unfortunately, the leaders of the stock market, including Apple, have yet to clear their previous highs. This I can tell you has done very little to generate much renewed confidence among investors.
The second was of course, Mr. Ben Bernanke. It's unfortunate that investors still to this day are hoping for his long awaited bailout package. Folks, expecting this announcement prior to a sharp decline is nothing short of wishful thinking. QE3, or lets say another currency swap, will only occur during or after a liquidation process out of all asset classes of the stock market. At the moment, there is not enough political pressure on him to push the button especially since the market has generated a near thirty percent gain from the October lows.
Thirdly, the dismal GDP figures were released the morning after Spain's credit rating was downgraded to BBB+. At the exact timing of this actual data, the dollar took a plunge. It was a classic example of the inner workings of our government bond buying program on stand-by. The "plunge protection team" will manipulate the dollar lower in the face of a game-changing event that has negative consequences. This is done in effort to create a soft landing in stocks, but it cannot delay the inevitable correction coming. You see, the government can hold up the market with Operation Twist, but it does not have the ability to change the current trend of the market.
While the Dow Industrials reasserted its underlying strength by clearing above its previous minor high, the remaining market averages are telling us differently. Usually the first week of every month is the time when money managers allocate their clients fixed income into dividend growth stocks. This explains the money inflows into the utility sector and for the same reason that twenty nine out of thirty Dow stocks closed mildly positive in yesterday's session.
Thursday, April 26, 2012
To no surprise, Ben Bernanke said nothing of a stimulus package yesterday. Spain is undergoing a mini-crash, and several of the big name companies are falling short of their bullish expectations. These bearish subtleties are clearly being hid from the market averages.
We’ve had a lot of news to digest this week and it has amounted to a sideways choppy market that whipsaws investors to death. Today- initial jobless claims were reported lower than expected, and just mentioned in the after hours, Spain’s credit rating was downgraded to BBB+.
This is only a small bite of today's market update. If you're interested in reading the full article, please go to the premium newsletter tab and subscribe today.
Friday, April 20, 2012
It's probably a good thing that I learned early in my trading career, not to shun, but to embrace fear. The old saying of "fear the unknown" in the marketplace is actually a disconnect between the the amateur (with only basic knowledge) and the seasoned veteran. What appears to be an unkown event to the rookie is seen as an opportunity for the senior. Courage is not the absence of fear, it's taking action in the face of it.
We're here to make money, and it takes a lot of self in this business. Almost all investors who became successful were able to take on the necessary risk in their life to enjoy the rewards. Don't forget that those same successful investors have also made every mistake in the book in their early days. Our job is to avoid making the big mistakes, and not get discouraged when facing minor set-backs. It takes approximately 10,000 hours of studying these markets to become confident and a competent investor. And along with a bit of luck, and patience, you become "World Class."
Bottom Line- Find your "theme" and stick to it, don't deviate from it. These markets will soon break the backs of many financial advisers, economists, and money managers of every description. The media is now beginning to turn slightly bearish, which is, a subtle early warning sign in itself. Now that all of the conditions have been met, the only question that remains is, can you risk a bet on your own conviction?