4/4/2016- A negative day with the Dow Jones down 56 points (-0.31%) and the Nasdaq down 23 points (-0.46%)
At the present moment the bulls are having a good laugh at the expense of the bears. After all, the rally off of January/February lows has retraced most of the decline, many believe that Janet Yellen will not let the market fall and according to some, new all time highs are just around the corner.
Perhaps. Yet, before you jump on the bullish bandwagon, consider the following bearish divergences.
- The $90 Billion Default Flood -Carl Icahn, Jim Rogers and many others have been talking about this for a few months. Pay attention as they are 100% correct.
- The death cross is saying to stay away from U.S. stocks – A good technical data point to consider.
- The yield curve is telling us something – The yield curve continues to flatten. That typically signals recession ahead. No matter what Janet Yellen says.
- This Indicator Suggests A Bear Market Is Now Underway And It’s Likely To Be A Painful One – Another good data point to consider.
- Trump’s prediction of ‘massive recession’ puzzles economists Now, don’t forget, most economist are wrong most of the time and they certainly never “see” the recession coming. Plus, who would you rather listen to….a bean counter or a successful businessman.
- Smart Money Flunks Out as $2 Billion of VIX Bets Come – Fair enough, but we should consider latest COT reports. Commercial interest have increased their VIX net long position to 3X their short. That typically happens prior to large declines.
- Earnings will decide the stock market’s fate – Bullseye.
Listen, most of the rally (at least 50%) off of January/February lows has been caused by intentional and coordinated efforts of world central bankers. Central Bank Mafia Goes All In…Stocks Rally…A Little And while most bulls see this as a licence to keep the party going, I do not share in their enthusiasm.
Instead of cheering the next phase of this supposed liquidity party, bulls should ask themselves the following question……if the Economy is so great why is Janet Yellen terrified of raising interest rates by a laughable 25bps?
I think you know the answer to that question. At the end of the day, it is all about earnings and current valuation levels. Something we have covered on this blog extensively.
This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014/15-2017. 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 2014/15-2017 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. April 4th, 2016 InvestWithAlex.com
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