6/8/2016 – A positive day with the Dow Jones up 68 points (+0.38%) and the Nasdaq up 13 points (+0.26%) 

One of the effects of today’s low interest environment is bubble level valuations we see in the stock market. In fact, according to some, zero interest rates mean an infinite valuation range for all stocks. At least in theory.

• Why U.S. interest rates will stay low forever

The sad reality is that until and unless the U.S. posts employment metrics that are consistently strong, or inflation rises significantly and stays elevated, there simply isn’t a case for hiking interest rates this month, this year — and even next year.

Forever is a long time. Many investors also assume, wrongfully I might add, that the Fed can control the entire yield curve.

We have been arguing here for about 2.5 years or since the 10-Year Note hit 3% in early 2014, that the 35 year bull market in bonds will put in a double bottom before surging higher. Well, we are nearly there.

Sure, the Fed will attempt to keep interest rates low, flooding the market with excess cash at onset of any trouble, but I still believe in the market. That believe leads me to a simple conclusion. When long side of the yield curve bottoms, and we are nearly there, yields will eventually surge higher.

On their own and no matter what the Fed does. It is at that time that the illusion of “infinite valuations” will come crashing down back to Earth.

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 8th, 2016  InvestWithAlex.com

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6/7/2016 – A mixed day with the Dow Jones up 18 points (+0.10%) and the Nasdaq down 7 points (-0.14%).

If you have no short-term memory, as is the case with most “professionals” on Wall Street, investment sentiment was downright scary just a few months ago. On or around February 11th low to be exact. With numerous investors and market pundits calling for an all out crash and financial Armageddon. I wrote about it at that time.

Financial Media Predicts Armageddon – Time To Go Long? (Feb 10th)

Today, the situation is entirely reversed. You would be hard pressed to find a bear. With most market participants and pundits already celebrating new all time highs.

Too soon…..time to go short? Perhaps.

Before we can answer that question with any degree of certainty we have to ask ourselves the following question……has anything changed since February 11th bottom?

Not fundamentally, but the investment sentiment did swing in the opposite direction.

Now, one can argue that the Fed’s inability or unwillingness to raise interest rates is what’s driving this market higher. It might be, but you won’t find me in that analytical camp. I have been posting for over a year here that the Fed will not raise interest in any meaningful way going forward. Why The FED Will NOT Be Raising Rates Next Year That should have been clear a long time ago.

In short, the fundamental backdrop we have faced in February of this year remains there. With a few notable exceptions. The US Economy, earnings and guidance continue to deteriorate, all while valuations remain at sky high bubble valuations levels. The chart below just about says it all.

Invest accordingly.

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 7th, 2016  InvestWithAlex.com

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All primary World War 3 parties, Russia, China and NATO, continue on with their respective arm races. Let’s take a look at the latest news dump…..

• RUSSIA FEARS NATO ‘GLOBAL STRIKE’ FROM EASTERN EUROPE – Quite a few very good points in this article. Just imagine what would have happened if either Russia or China were amassing a massive military presence, bases, supply chains, etc….. on the US/Mexican border.
• US asks Russia not to target Al-Qaeda branch in Syria – Is this treason?
• US drops weapons to rebels in Syria – Again, is this treason?
• China says it doesn’t fear ‘trouble’ in S. China Sea – how many wars can the US fight at once?
• Russia Is Set to Build 12 New Monster Warships Armed with 200 Missiles Each – invest in defense?
• NATO is sending troops to Poland to stare down Russia – Didn’t Hitler and Napoleon do the same thing?
• KREMLIN CANNOT INTIMIDATE ROMANIA, SAYS PRESIDENT – Congratulations Romania. Once the war starts there will be a big hole where Romania once was.

Point being, what was outlandish just a few years ago (my forecast – Nuclear World War 3 Is Coming Soon.When, How & Why), is now becoming crystal clear. With all superpowers arming themselves to the teeth, war comes closer with each passing day. Sad.

6/6/2016 – A positive day with the Dow Jones up 113 points (+0.64%) and the Nasdaq up 26 points (+0.53%).

According to quite a few bulls, the stock market is about to breakout. Finally.

US stock market is getting closer to a ‘melt up’: HSBC

Two major components of the S&P 500 could break out, according to the note sent out by Murray Gunn and team. They are industrials and the “FANG” stocks, composed of Facebook Inc., Amazon.com Inc., Netflix Inc., and Alphabet Inc. “The S&P 500 industrials sector has given a bull signal with momentum turning higher on the back of a positive cyclical trend indicator,” the analysts write, meaning that the slope of the 200-day moving average is showing positive momentum that could preface a further move higher.

Wonderful……right? Perhaps, but just as some analyst expect the most speculative stocks to surge higher, others see major trouble ahead.

Did the S&P just crush this ‘irrefutable’ sell signal?

I may disappoint permabears when I say this, but just because it happened twice before, doesn’t mean it will happen again. Also, no stock market signal is ever irrefutable.

Wow, as soon as it is not convenient, “doesn’t mean it will happen again” tends to come out. Perhaps. Or, is it as simple as this?

Investors paying too much for growth

I believe the reality here is rather straight forward. The Fed has distorted the markets to such an extent that things no longer make sense. For either bulls or bears. With the market flashing technical signals that both support a bull market rally or an outright collapse.

Which way will it go?

One think is certain, we are about to find out.

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 6th, 2016  InvestWithAlex.com

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