Think again. On the contrary actually. There is a structural/cyclical reason that long-term stock market rallies last 5-Years and not that much longer. I have discussed it in the past (just search “5-Year Cycle”). In fact, the longest single bull market cycle over the last 150 years lasted 64-months.
Given today’s unsustainable stock market valuation levels, FED tightening, speculative fever, bottom hitting VIX, etc…. the writing is on the wall. The bull market that started in 2009 is coming to an end. This is further confirmed by my mathematical and timing work. Again, our work shows a severe bear market between 2014-2017. 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 exactly when the bear market will start (to the day) and its subsequent internal composition, please CLICK HERE
I continue to scratch my head while trying to figure out exactly what the US and NATO are trying to do as they push Russia into a corner. While the Western Media outlets would lead you to believe the situation in Ukraine is getting better, the overall picture remains troubling as the US Military Industrial complex seeks out an outright conflict. Russia considers NATO buildup near its borders as demonstration of hostility – deputy FM
At least in this case I do not believe this has anything to do with “Russian Propaganda” as the map above speaks for itself. Add a few more years and a few countries to the blue map above and you have Russia nearly encircled. This would be equivalent to having a massive Russian military buildup in Canada, Mexico, Cuba, the Atlantic and the Pacific. Does Russia pose a threat? I don’t believe so and I don’t see it.
Point being, anticipate this situation to escalate further as the war mongers in Washington seek world domination.
A strong up week with the Dow Jones up 207 points (+1.24%) and the Nasdaq up 79 points (+1.86%). All markets left a large downside gap on Friday, June 6th. That is in addition to a gap on May 27th, two large gaps on May 21st/23rd and two large gaps on April 14th/16th. Suggesting an eventual correction.
Further, there are a number of smaller gaps left leading all the way down to February 5th low. We continue to believe that the Dow will close such gaps when the next bear leg develops at below mentioned time frames (please see mathematical analysis & timing section below).
WEEKLY REVIEW:
The Shocking Downside Of American Real Estate Bubble 2.0
Over half of Americans (52%) have had to make at least one major sacrifice in order to cover their rent or mortgage over the last three years, according to the “How Housing Matters Survey,” which was commissioned by the nonprofit John D. and Catherine T. MacArthur Foundation and carried out by Hart Research Associates. These sacrifices include getting a second job, deferring saving for retirement, cutting back on health care, running up credit card debt, or even moving to a less safe neighborhood or one with worse schools.
If you need someone to blame I have got a few people for you. You can start with Greenspan, Bernanke, Yellen, Clinton, Bush, Obama and everyone in the US Congress/Senate over the last 20 years. All of them were, more or less, directly responsible for perpetrating this massive financial crime against the American people.
While you might have enjoyed your house going up in value 500% over the last 15 years you will not enjoy what happens next. As the chart above illustrate, the “Dead Cat Bounce” in real estate prices is almost over and the market is rolling over. As predicted here, Real Estate Collapse 2.0 Why, How & When the real estate market is about to suffer a massive Stage #3 correction. By the time it’s over, most Americans should be able to afford a house…again. I can’t wait.
Is Gold Dead Or Is It Bottoming?
According to most market pundits, Gold is dead and you should buy stocks and real estate.
Gold is hitting new multiyear lows relative to the Standard & Poor’s 500 Index. J.C. Parets, a technical analyst at Eagle Bay Capital, notes: “This downtrend has been very strong over the past 30 months and is hard to fight.”
Yes, Gold is in a technical downtrend, likely to test $1,200 (maybe even lower) and the time to buy it is not quite here. Yet, to look at it from such a perspective is like looking in a rear view mirror.
Here is what I believe to be the best way to look at Gold and it’s price.Forget about the fundamental factors such as supply/demand and geopolitical events. From our vantage point, Gold’s technical/structural setup is identical to the one in 2007 when Gold went from $600 to $1,800 an ounce.
With our mathematical and timing work predicting a severe bear market between 2014-2017, the FED will have no choice but to introduce further stimulus in order to try and re-inflate our markets and the economy. When that happens, I would expect Gold to be surging higher, not setting new lows. In fact, I continue to believe that Gold will be one of the better investments out there over the next 3-5 years.
All you have to do now is wait for Gold to bottom, break out above $1,420 and we should be off to the races. Be patient now. Our timing work shows that the next stage of the bull market in Gold is just around the corner as it will be surging higher by around this time next year. If you would like more precise timing please Click Here.
Peter Schiff Capitulates: Are Markets About To Collapse?
Peter Schiff, one of the most “in your face” perma bears has basically capitulated. After years of predicting US Equity market collapse, appearing on various TV/Radio shows and writing a few books on the subject matter, Peter now believes the FED will be able to delay any such collapse….. “The air is already coming out of the bubble” but Fed can delay collapse: Peter Schiff
A contrary indicator?
You bet. Listen, Peter Schiff is a very intelligent man. Yet, one of the hardest things out there is to be a bear in an ever increasing bull market. Even though your research might be right, your timing might be off by as much as a few years. And the market makes you pay for it by making you look like an absolute idiot. I had the privilege of experiencing this in 2006-2007 when my call for 2008 collapse was a few years early.
This is something that all investors should be aware of. I call it an emotional detachment from a proposed outcome. While it is important to have a very well researched position, it is even more important to be able to change your view when need be. Very few people can do that and that is why most people buy at the top and sell at the bottom. Unfortunately, Mr. Schiff is giving up at exactly the wrong time.
MACROECONOMIC ANALYSIS:
I am just as tired of this as you are, but Ukraine/Russia/USA/EU/NATO continue to be the most important issue.
On a positive note, despite heavy fighting in East Ukraine it appears the situation is starting to die off. The upcoming week is critical. There is a real possibility the situation will work itself out and disappear from the international stage. At the same time and as in any conflict, the situation might re-escalate quickly.
Further, I no longer believe that Russia will get involved in this conflict directly. There is just too much downside and not enough to gain for Russia to get militarily involved in East Ukraine at this stage. Basically, the next few weeks will tell us if the situation dies off or re-escalates. Let’s hope for the latter.
TECHNICAL ANALYSIS FOR THE DOW JONES:
Long-Term:The trend is still up. Market action in January-February could be viewed as a simple correction in an ongoing bull market. Same applies to the market action over the last few months. Yet, that in itself can be misleading as per our timing analysis discussion below.
Intermediary-Term:Since February 5th, intermediary term picture shifted from negative to positive. Giving us a technical indication that both the intermediary term and the long term trends are up. Yet, that in itself can be misleading as per our timing analysis discussion below.
Short-Term:Short-term trend remains positive for the time being. The Dow would have to break below 16,000 for the short-term trend to shift from positive to negative.
Again, even though all 3 trends are bullish for the time being, that might be misleading. Please read our Mathematical and Timing Analysis to see what will transpire over the next few weeks.
MATHEMATICAL & TIMING ANALYSIS:
It’s going to be a long one.
First, a re-cap. Particularly for our new subscribers. Over the last few months we have maintained that the DOW will…..
(*** Please Note: This time around about 90% of the information contained within this section has been deliberately removed as it contain too much technical information. Particularly, exact dates and prices of the upcoming turning points. As well as trading forecasts associated with them. I deem such information to be too valuable to be released onto the general public. As such, this information is only available to my premium subscribers. If you are a premium subscriber please Click Here to log in. If you would be interested in becoming a subscriber and gaining access to the most accurate forecasting service available anywhere, a forecasting service that gives you exact turning points in both price and time, please Click Here to learn more.Don’t forget, we have a risk free 14-day trial).
In conclusion, xxxx
Longer-Term Overview:
The next turning point is located at……
Date:XXXX Price:XXXX
TRADING:
I am now fully committed to the XXXX side of the market with 11 individual positions taken at the prices outlined below. A lot of them have done incredibly well thus far and I hope you were able to benefit as well. I will be updating you of any changes or anticipated changes before they take place.
Remember, you should have an exact strategy and entry/exit points based on the forecast above.
The list below is for your reference point. It entails my investment strategy for my own investment purposes. While you are free to follow me, please do so at your own risk. Do not take this as a trading advice. Please note, all of the positions below have been triggered.
Stock
Entry Point ($)
Action Taken
Stop Loss @
xxxx
xxxx
xxxx
91
xxxx
xxxx
xxxx
1250
xxxx
110
xxxx
121-123
xxxx
74
xxxx
80
xxxx
xxxx
xxxx
260
xxxx
xxxx
xxxx
460
xxxx
35
xxxx
39
xxxx
65
xxxx
70
xxxx
120
xxxx
120-130
xxxx
100
xxxx
108-112
xxxx
112
xxxx
120
Otherwise, I suggest the following positioning over the next few days/weeks to minimize the risk while positioning yourself for a forecasted market action. (This is continuation of our previous positioning).
Weekly Stock Market Update & Forecast. May 17th, 2014. InvestWithAlex.com
If You Are A Trader:XXXX
If No Position:XXXX
If Long:XXXX
If Short: XXXX
CONCLUSION:
An incredibly important week is coming up. We are now looking for our forecasts above to be confirmed over the next few trading days/weeks. I have also described what to anticipate over the next few months and exactly what you should do now. With increased volatility, multiple interference patterns and an incredibly important long-term turning points coming up over the next few months we must be very careful and risk averse here. Those anticipating the moves and those who can time them properly will be rewarded appropriately.Weekly Stock Market Update & Forecast. May 31st, 2014. InvestWithAlex.com
Please Note:XXXXis available to our premium subscribers in our+ Subscriber Section. It’s FREE to start.
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Another up day with the Dow Jones up 87 points (+0.52%) and the Nasdaq up 25 points (0.59%).
The market continues to push higher while the VIX (volatility/fear index) collapsed bellow 11, pushing some of the lowest levels ever recorded. As I write this, it is about 4% away from its 2007 low. We all know what happened thereafter.
On the flip side, Uber Technologies Inc (a money losing company) just completed a Venture Capital round at $17 Billion valuation. Yes, you have read it right. A company with no net income and a “Big Sparkly Dream” of being the “Next of Something” is worth more than Hertz Global Holdings Inc, Best Buy Co, Alcoa or another 250 companies on the S&P 500 index.
If this doesn’t SCREAM out “Market Top” or show you how out of touch with reality today’s valuation levels are, I am not sure what will. Certainly, a multitude of Wall Street analyst and talking heads are standing by to proclaim that it is “different this time”. Yet, if you value your money you wouldn’t buy it for a second.
This is further confirmed by my mathematical and timing work. Again, my work shows a severe bear market between 2014-2017. 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 which way it will break and when, please CLICK HERE
(***Please Note: Due to my obligations to mySubscribersI 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, pleaseClick Here). Daily Stock Market Update. June 5th, 2014 InvestWithAlex.com
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Today’s job number came in as expected (217K added Vs 215K Expected), pushing the official unemployment rate to 6.3%.
Is this recovery a real deal or a bunch of nonsense?
You be the judge, but if we study the chart above the answer becomes painfully obvious. If we are to add back the unemployed, the underemployed and those who are not looking (gave up) but want a job, the number jumps to 12.5%. Making today’s economic recoveries one of the weakest on record.
So, we are left with two possibilities here. The job growth is simply lagging the stock market and we will soon get a surge in hiring, capex spending, corporate profit growth, etc…. -OR- the stock market is in a massive bubble and this job growth (however weak) has nearly maxed out. Unfortunately, based on my mathematical and timing work, it’s the latter.
One of the constant things you hear from the Financial Media Talking Head on TV and in print is that the CAPEX spending will come back with the vengeance and drive the US Economy forward. Despite the stock market being up over 150% in the last 5 years and the economy exhibiting various signs of strength, CAPEX remains in the dumps.
Will it turn around and be the next growth driver?
No chance in hell. Listen, there is a huge disconnect between what the stock market and the perceived economic strength is saying and what the CEO’s see on the front lines. Simply put, they don’t see the growth the stock market is projecting and they are not spending because of that. This adds credence to my point of view that the stock market has long disconnected from any sort of economic reality and is now in a bubble territory. If anything, I would expect CAPEX to keep declining as the bear market of 2014-2017 hits.
Shiller’s data, going back to 1880, show that the historic average CAPE for the U.S. stock market has been about 16. When the market has been significantly above that, subsequent returns have typically proven to be poor — and vice versa. Today it is at 25.
I have argued this before, but here is what most people don’t understand about today’s earnings. They are abnormal…a figment of one’s imagination. Same as they were in 2007 when the S&P earnings went from a seeming normal P/E of 18 at 2007 top to 128 during the collapse in 2008.
Back then earnings simply vanished into thin air, just as they will today.Why? Because most of the corporate earnings everyone relies on today are based on a massive amount of credit within our financial system. That massive QE and low interest rate stimulus that the FED unleashed on the US economy. When it goes away (just as it did in 2007-2009) you will see corporate earnings collapse….making today’s valuation not only expensive, but insanely expensive. One thing is for sure….it’s never different.
Another up day with the Dow Jones up 98 points (+0.59%) and the Nasdaq up 44 points (1.05%).
As the chart above illustrates, the stock market has ZEROfear as all of the bears have been taken out to Siberian Taiga and shot dead. In other words, this is as good as it gets for the bull market. Just as it was back in 2007.
I have long argued that the stock market has by now disconnected from any sort of reasonable fundamental valuation levels (due to massive FED stimulus) and is now in a bubble territory. Despite strong technical indicators and trends, investors must be very careful here.
Just as the reminder……. most bull markets do not last longer than five years, we remain in a secular bear market that started in 2000 and will terminate in 2017, the valuation levels are outright crazy (I can’t find any value), the FED is tightening, fear levels/indicators hitting all time lows, etc….. The bottom line is, and as stupid as it sounds, the market is climbing higher for the sake of climbing higher.
This is further confirmed by my mathematical and timing work. Again, my work shows a severe bear market between 2014-2017. 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 which way it will break and when, please CLICK HERE
(***Please Note: Due to my obligations to mySubscribersI 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, pleaseClick Here). Daily Stock Market Update. June 5th, 2014 InvestWithAlex.com
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