Daily Chart AFebruary 29 InvestWithAlex

2/29/2016 – A negative day with the Dow Jones down 127 points (-0.76%) and the Nasdaq down 33 points (-0.71%)

Gold bugs are excited. It appears Gold is breaking out of its multi-year slump after taking out important resistance levels. Fundamentals look right as well. As any financial crisis caused by the overvalued stock market would surely cause massive inflows into the sector.

Why buying gold now could be a lot like buying stocks in 2009.

Perhaps. Yet, a number of things do not add up. Most importantly, various technical and sentiment indicators suggest that the bottom is not yet in. Here is the view expressed by Matt Demeter Find Out Why Gold Is Going Much Lower A view that is just as valid today.

Now, let’s talk about China. The first rule of investing is…….when a government entity issues a strong statement in support of a financial instrument, you know what to do. Run the other way. Here is what China had to say about Yuan devaluation

China assures US no devaluation, pushing reforms forward

Fair enough, but I would rather listen to what hedge fund manager Kyle Bass had to say about the subject matter. We wrote about it just a few days ago Further Yuan Devaluation Imminent In other words, China has no choice. It either devalues or goes through an economic/financial collapse. Invest accordingly.

Finally,there is at least one bull out there who still believes….

Tom Lee: These factors point to higher stocks

Longtime bull Tom Lee said Friday it’s been tough lately to be positive on stocks, but too many investors may have have tilted to the bearish camp. Lee played down the concern about the possibility of a global recession, saying market internals like transport and small-cap stocks are not pointing to a recession. “If we’re actually seeing worsening economic conditions, these should be in a death spiral,” he said. But he noted that these groups have actually been doing better.

I actually would have to agree with Mr. Lee in regards to investor sentiment. I wrote about it just a few days ago. Shocking: Here Is Why The Stock Market Is Rallying

As for the latter, I strongly disagree. Fewer and fewer stocks are keeping this market afloat. On top of that, valuations are still incredibly high as per Shiller’s Adjusted P/E ratio. We are talking about historic highs. All while the S&P earnings are falling at the fastest pace since 2008 financial crisis. Forward guidance was adjusted down a little over 2%.

Put all of that together and it becomes fairly clear which way the market will swing long-term. That is not to say we can’t have substantial rallies along the way, but rather, to suggest that any bullish dreams might have to be adjusted here.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2015-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years. If you would be interested in learning when the bear market of 2015-2017 will start (to the day) and its internal composition, please CLICK HERE.

(***Please Note: A bear market might have started already, I am simply not disclosing this information. Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. February 29th InvestWithAlex.com

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