InvestWithAlex.com 

Subscribe Today
My Account

Category: Stock Market

Posted on

Shocking: No Capital Gains Over The Next 50 Years?

Daily Chart June 22 InvestWithAlex

6/22/2015 – A positive day with the Dow Jones up 107 points (+0.59%) and the Nasdaq up 37 points (0.72%). 

Let me ask you a question. If someone from the future approached you on October 10th, 2007 and outlined the next 7-8 years within the stock market, what would you do? Would you….

  1. Completely ignore the 2007-2009 sell-off because the market would eventually make up all of the losses and then push higher within the next 7 years -OR-
  2. Pawn your left kidney, sell your firstborn and then buy every put option you could afford in anticipation of a 2007-2009 decline. Only to repeat the process at 2009 bottom with call options.

Well, I don’t think there a doubt that most people would go ahead with option B. Unless they have few screws missing and/or too lazy to get their broker on the phone.

Why am I bringing this up? 

I am beginning to see quite a few “What’s The Big Deal” Or “What’s the Worst Case Scenario” articles being propagated by the mainstream financial media. For instance, The worst case if you invest in a hot stock market

Worst case scenario: In nearly 90 years of market history, if you bought stocks on the absolute worst day, the average time to make your money back was 3 years. That’s less time than it takes most people to get through high school or college. It’s doable. It shouldn’t make you shy away from investing in stocks.

“Obviously, to live through that is painful,” says Valeri, an investment strategist. “But when you think about what you’re investing for — and for most people it’s at least 10 or 20 years out — you will get past that.”

They all come to the same conclusion. Even though the stock market is overvalued, do not worry and keep buying, your investment will eventually appreciate. Perhaps.

Just 90 years? I have the Dow chart going all the way back to the first day of trading. May 19th, 1790 or 225 year. Let me tell you something. There have been quite a few periods of 50 years or more when stocks haven’t gone anywhere.

For example, the stock market hasn’t really gone anywhere between 1790 and 1860. A 70 year period of time. Sure, there were bull and bear markets, but no net capital gains. Then, if you went long in 1899, you didn’t see any “net inflation adjusted” gains until 1951.

So, what is the risk going long today, at the 3rd highest level of valuations in the history of the market (behind 1929 and 2000 tops)? Umm, I don’t know, but I would imagine there is quite a bit of risk associated with such a stupid proposition.

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. June 22nd, 2015  InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

Shocking: No Capital Gains Over The Next 50 Years? Google

Posted on

Jim Rogers: Major Correction Ahead…Central Banks To Panic

There is only a handful of people worth listening to when it comes to investing. Jim Rogers is one of them. Below is the podcast he did a few weeks ago and it is definitely worth a few minutes of your time.

Jim talks about equity markets, Russia, China, Greece, oil and gold. Plus, bureaucratic idiots in Washington. I’ll tell you one thing, it is nice when Jim’s views match my own.

In short, Jim anticipates major….major problems in the US Equity markets. Should you?

z32

Jim Rogers: Major Correction Ahead…Central Banks To Panic Google

Posted on

COT Reports & Weekly Market Calendar – June 20th, 2015

COT Reports: If you are not familiar, the Commitments of Traders (COT) reports provide a breakdown of each Tuesday’s open interest for markets in which 20 or more traders hold positions. In other words, it gives us a preview of what commercial interests are buying or selling. As the theory goes, we want to be on the same side of the trade as the big guys.

While not a good timing tool, currencies, commodities and the stock market (to a lesser extent) tend to move in the direction of the bets made by the commercial players. Not always, but often enough.

Latest data, as of June 16th, 2015

Currencies: 

  • USD:  2K Long Vs. 54K Short – Significant short interest remains. Although it has decreased by 18K contracts.
  • Canadian Dollar: 44K Long Vs. 37K Short – No change. Neutral
  • British Pound: 45K Long Vs. 7K Short – Commercials decreased their short position – more long now.
  • Japanese Yen: 129K Long Vs. 1K Short – Large long position in Yen remains.
  • Euro: 115K Long Vs. 7K Short – Significant long position remains.
  • Australian Dollar: 68K Long Vs. 4K Short- Significant long position.

Conclusion: Based on the information above, commercial interests expect the US Dollar to decline while British Pound, Euro, Yen and Australian Dollar rally. 

Markets/Commodities/Volatility: 

  • E-Mini S&P 500: 224K Long Vs. 653K Short – Slight increase in short interest. A heavy short position remains.
  • VIX: 115K Long Vs. 18K Short – Heavy long position suggests market turbulence ahead.
  • Gold: 72K Long Vs. 94K Short – No change. Still neutral.

Conclusion: Based on the information above, commercial interests expect the stock market to decline as volatility surges higher.

Next Week’s Market Calendar: 

  • June 23rd – Durable Goods
  • June 24th – GDP Reports

COT Reports & Weekly Market Calendar – June 20th, 2015 2015 Google

Posted on

Earth To Bulls: No Capital Gains Over The Last 12 Months.

Daily Chart June 19 InvestWithAlex

6/19/2015 – A negative day with the Dow Jones down 103 points (-0.57%) and the Nasdaq down 16 points (-0.31%) 

In two weeks time, the NYSE (largest composite by capitalization) will mark a 1-year trading range anniversary. In other words, while there have been some net positive sectors(mostly specs), the overall stock market hasn’t gone anywhere in close to a year. And quite a few sectors are selling off.

Further, with VIX/VXX being where they are, most traders and investors find themselves in a very deep slumber. At exactly the wrong time. As I have mentioned here before, the market is accumulating energy, and once released, most investors will be caught with their pants down. As always. That is to say, a massive amount of volatility will come back into the market at some point this year. If you would like to find out exactly when that will happen, to the day, please Click Here.  

Now, let’s see what’s trending.

Traders channel Bill Murray on Greece, China: ‘It just doesn’t matter’

As was mentioned above, don’t confuse today’s strength with the market’s resilience or being able to avoid a potentially explosive situation. It is all about timing and sequencing. As my subscribers very well know, the market is in the process of completing a certain structure. When that period of low volatility ends, things will turn on a dime.

And no matter what the fundamental situation is at the time. We will see if these same traders will be able to say “It just doesn’t matter” then. For now, we wait.

It’s a bond market exodus

We have beaten this topic to death over the last few months, but it is important to keep it in the back of your mind.

“High grade credit funds suffered their biggest outflow this year, and double the previous week (and also the biggest since June 2013). High yield outflows also jumped to $1.1bn, the biggest since the start of the year. However, government bond funds suffered the most amid the recent spike in volatility, with outflows surging to the highest weekly number on record ($2.7bn). This brings the total outflow from fixed income funds to almost $6bn over the last week, the highest since the Taper Tantrum and the third highest outflow ever.”

There are two things to consider here. First, if the FED if unwilling to raise rates, the bond market might do it for them. Either way, it’s bad news for the stock market.

Second, there is very little liquidity in both the bond market and the stock market. I am hearing it directly from friends who have large individual stock positions. It is taking them a long time to liquidate their stakes without impacting the price. Meaning, should the market accelerate to the downside, let’s say a 10-15% move down, we are likely to see panic and acceleration. Be aware of that.

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. June 18th, 2015  InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

Earth To Bulls: No Capital Gains Over The Last 12 Months.  Google

Posted on

Double Top Galore Or Are We About To Breakout?

Just a few charts to think about.

Inflation Adjusted S&P is sitting at a 15 year double top.

S&P inflation adjusted

Nasdaq is sitting at a 15 year double top.Nasdaq double top

Biotech (IBB) just put in a double top.

IBB2

So, are we are about to break out -OR- multi year double tops are being put in place? Click Here to find out.

z32

Double Top Galore Or Are We About To Breakout?  Google

Posted on

Marc Faber: A Much More Severe Correction Is Coming

Financial media talking heads can’t help themselves. They can’t stop making fun of Marc Faber’s view by pointing out how wrong he has been over the last few years. Here is what most people don’t realize. There is a difference between being wrong and being too early. Something I have experienced firsthand after predicting the 2007-2009 meltdown as far back as 2005.

Marc is not wrong, he is early and we are working under the conditions where a bubble can be expanded much further than most “rational” people would believe. That is the environment today.

With that in mind, think about it in the following fashion. Should the S&P correct just 30% here, something that wouldn’t even bring today’s valuations back to their historical norms, it would wipe out the last 4 years of capital gains. Pardon me, the first time the S&P saw the 1,400 level was in 1999. So, it would wipe out 16 years of market progress. It all depends on your perspective.

Z31

Marc Faber: A Much More Severe Correction Is Coming  Google

Posted on

Specs Keep This Market Afloat….Good or Bad?

Daily Chart June 18 InvestWithAlex

6/18/2015 – Another positive day with the Dow Jones up 179 points (+1.00%) and the Nasdaq up 68 points (+1.34%) 

A massive and rather rapid stock market decline is coming later on this year. And while we won’t have a crash, considering the amount of margin debt out there, quite a few people will get wiped out. If you would like to find out exactly when this move will develop, to the day, please Click Here. 

The NYSE (largest index by capitalization) hasn’t gone anywhere in close to 12 months, the Dow Transports recently confirmed short-term breakdown, Shiller’s S&P P/E ratio is at 27 (third highest in history) and VIX/VXX are scraping the bottom of their trading range.

And while fewer and fewer stocks are participating in recent rallies, there are quite a few areas that are keeping this market afloat. What are they? Speculative stocks (specs). The Nasdaq, Russell 2000 and Biotech. A few sturdy sectors are preventing a market breakdown

Is that Good or Bad? 

That depends on whom you ask. Most bulls see this a net positive, suggesting that this group provides leadership and that broader markets will follow suit. Most bears would argue that these sectors will be the last to go, and when they do, they are likely to move to the downside quite rapidly.

Unfortunately, financial history does not offer us a proper answer. Sometimes the specs lead and sometimes they follow the market. With that said, today’s overall setup is more reminiscent of 2000 top.  At that time the broader market led most specs by about 3 months.

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. June 18th, 2015  InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

Google

Posted on

Marc Faber: Why The FED Won’t Raise Rates

I tend to agree with Marc. As I have said on numerous occasions here, even if the FED raises rates, it won’t be long before they are cutting them again.  And while most people will misconstrue this development as a positive one for stocks, it is anything but. 

Z31

Marc Faber: Why The FED Won’t Raise Google