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Is Janet Yellen Ready For Her Market Hazing?

Daily Chart Uly 28 InvestWithAlex

7/28/2015 – A positive day with the Dow Jones up 188 points (+1.08%) and the Nasdaq up 49 points (+0.98%) 

Well, as was discussed here last night, Dennis Gartman maintains his perfect “reverse” turning point track record. With that in mind, the stock market continues to behave as per our internal forecast. If you would like to find out what happens next, please Click Here. 

Tomorrow we have the Fed interest rate decision. And since they have been SO accommodating  to the market over the last few years, we shouldn’t expect anything surprising. Which brings us to my two primary Fed related themes.

First, I continue to maintain that the FED has missed the window of opportunity to raise interest rates. It is too late now. Why?  They needed to reload their recession fighting tool kit before the next recession or bear market strikes. The problem is………we are already there as per my mathematical and timing work. That will become evident to everyone else over the next 12 months.

That is to say, the stock market/economy will collapse while interest rates remain at ZERO. What will they do…..another round of QE? Most certainly, but that won’t save the day. The bond market might react to such a development in a negative way this time around, driving yields higher, not lower.

Second, every FED Chairman since Paul Volcker, and to a certain extent before, has been baptized by fire of a large scale market sell-off. Let me give you an example.

  • Paul  (The Iron Will) Volcker: Took office in August of 1979. Last down leg of a 1966-1982 bear market started in April of 1981. Baptized by fire 1.5 years into his tenure.
  • Alan (The Master Printer) Greenspan: Took office in August of 1987. Baptized by fire just two months later, when the crash of 1987 took place.
  • Ben (The Savior) Bernanke: Took office in February of 2006. The 2007-2009 bear leg started in October of 2007. Baptized by fire 1.75 years into his tenure.
  • Janet (Everything is Peachy) Yellen: Took office in February of 2014. Now 1.5 years into her tenure.

I am sorry to tell you this Ms.Yellen, but if the trend above holds true, you are about to get creamed along with every other bull out there. Just saying!!!

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. July 28th, 2015  InvestWithAlex.com

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

Is Janet Yellen Ready For Her Market Hazing Google

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Dispelling The Myth Of Long-Term Stock Market Prosperity

Nikkea2

Take a look at this Nikkei 225 stock chart. The index is still 50% down from its top 25 years ago. In the past I have identified two even longer periods within the US stock market when inflation adjusted returns remained at zero. That is, 1790 to 1860, a 70 year period of time and 1899 to 1949, a 50 year market cycle.

That would be incomprehensible to most investors today. For instance, take a look at this typical write up of how 50% of Americans are somehow missing out on this magical wealth generating engine that is the stock market.

More Than Half of All Americans Could Be Set Up for Financial Disappointment — Here’s Why

More than half of Americans are set up for financial disappointment According to the Money Pulse survey released in April by Bankrate, a whopping 52% of adult Americans don’t have a single cent invested in the stock market. This includes individual stocks as well as stock-based investments such as a mutual fund.

I would argue that they the smart ones, not the other way around. Take a look at the S&P chart below. That is an inflation adjusted return since 2000 or lack thereof. What’s worse, we are on a verge the next bear leg.

So, instead of trying to scare people into the stock market, financial professionals should spend more time on minimizing risk the “unlucky” 50% are about to suffer. If you would be interested  in learning exactly when this bear market will start, please Click Here

S&P inflation adjusted

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Dispelling The Myth Of Long-Term Stock Market Prosperity  Google

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Did Our Secular Bear Market Terminate In 2009? Keep Dreaming

1-aWhen it comes to the overall stock market or individual stocks, investors are always able to find at least a dozen data points to support their investment decision. Whatever that decision might be.

Lately, quite a few people have been coming out of the woodwork in an attempt to justify today’s bull market. Here is one of the dumbest I have seen in a while…..Stocks just did something they haven’t done since 1904

“The S&P 500 did something in the first half of 2015 that it has not done since 1904 — the S&P 500 posted two consecutive (back to back) quarters of 0% gains,” Lee said. “In fact, this has happened only one other time in the past 125 years, for either the Dow and the S&P 500.”

The last time this happened, it was the Dow that stood still for six months in 1904. But then something else happened: Stocks surged 43% over the next two quarters.

I love pocking holes in historic financial analysis when people have failed to do their homework. You can’t compare 1904 to 2015, but not for the reasons you might think. At that time we were in a totally different location within the 1899-1914 secular bear market. Today, we are at the end of this same cycle.

Meaning, the stock market is more likely to decline 43% here than to surge higher. Why? Because that’s what markets do at the end of their respective 17-18 year secular bear market cycles. Ex: 1913-1914, 1946-1949, 1981-1982 and 2015-2017.

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Did Our Secular Bear Market Terminate In 2009? Keep Dreaming Google

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Why Only A Fool Would Buy Stocks Here

Daily Chart Uly 27 InvestWithAlex

7/27/2015 – Another negative day with the Dow Jones down 128 points (-0.73%) and the Nasdaq down 49 points (-0.96%) 

I think I might have found a “100% sure bet” investment strategy. Just do the complete opposite of what Dennis Gartman is doing or saying. For instance……..

Seriously….which one is it Mr. Gartman? How can anyone make money by jumping between short-term extremes. At least for now the stock market is oversold and warrants some sort of a bounce. Will we get one? That is yet to be seen, but it would be smart to at least prepare for one. In other words, you might be a fool to go short here. 

On a more serious note, it appears the overall stock market is dying a slow death.

S&P 500 Propped Up by Just 2 Sectors Shows Bull Market Aging

More than 100 percent of this year’s increase in the Standard & Poor’s 500 Index is attributable to two sectors, health-care and retail. That’s the tightest clustering for an advancing year since at least 2000, data compiled by Bloomberg show.

We have been talking about exactly this for quite a while. And you don’t have to look further than NYSE (largest index by capitalization) to understand today’s market setup in its entirety. Here is what it is.

  • The NYSE hasn’t gone anywhere in over 13 months and is now down 3-4%.
  • That means the market is either building a massive base from which to start a multi-year bull run or it is distributing before a massive leg down.
  • Since Shiller’s P/E is at 27 (3rd highest level on record – right behind 1929 and 2000 tops) it is fairly easy to guess which way the market will break. .

Finally, with only a few highly speculative companies supporting the entire tech sector, it is not looking good. No QE, slowing earnings, interest rate hikes, no CAPEX, no liquidity etc….. I am having a very difficult time imagining what would save this market at this juncture. An outright miracle? Friendly aliens landing on the White House lawn? I honestly don’t know what that would be.

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. July 27th, 2015  InvestWithAlex.com

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

Why Only A Fool Would Buy Stocks Here Google

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Is Gold Really Doomed?

Gold Is Doomed InvestWithAlex

It has been a while since we have touched on gold. However, when mainstream media outlets post idiotic gold headlines, headlines that should spark investor attention, it might be time to take another look. Here is what I am talking about…..

The Washington Post: Gold is doomed

When you think about it, a bet on gold is really a bet that the people in charge don’t know what they’re doing. Policymakers missed yesterday’s financial crisis, so maybe they’re missing tomorrow’s inflation, too. That, at least, is what a cavalcade of charlatans, cranks, and armchair economists have been shouting for years now, from the penny ads that run on the bottom of websites…..

Wow….a double whammy there. Not only does the author suggest that most Gold Bugs are idiots, he also suggests that Greenspan, Bernanke and Yellen are brilliant economists who not only know what they are doing, they have full control of the US Economy. I might have a big problem with all of the above, but let’s save that for another time.

Back to gold. The sentiment above represents how most investors view gold today. I don’t have to tell you that when “Gold Is Doomed” articles are published, we might be approaching a major turning point and a bottom. I tell you what, if my overall stock market forecast fires off as my mathematical work suggests, you will see gold surging over the next 2-3 years. Due to additional rounds of QE and flight to safety.

The primary question is, where/when is gold’s bottom? That is for you to figure out, but it is likely to coincide with the stock market’s top. And if you would like to get that information, please Click Here.

z32

Is Gold Really Doomed?  Google

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Investment Grin Of The Day

Congress gets kidnapped……..

A driver was stuck in a traffic jam on the highway outside Washington, DC.

Nothing was moving.

Suddenly, a man knocks on the window. The driver rolls down the window and asks, “What’s going on?”

“Terrorists have kidnapped the entire US Congress, and they’re asking for a $100 million dollar ransom. Otherwise, they are going to douse them all in gasoline and set them on fire.

We are going from car to car, collecting donations.”

“How much is everyone giving, on an average?” the driver asks.

The man replies, “Roughly a gallon.”

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Investment Grin Of The Day Google

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COT Reports & Weekly Market Calendar – July 24th, 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 JULY 21st, 2015

Currencies: 

  • USD:  4K Long Vs. 78K Short – Significant short interest remains. No major changes.
  • Canadian Dollar: 63K Long Vs. 3K Short – Net increase in commercials net long position.
  • British Pound: 45K Long Vs. 31K Short – Remains neutral.
  • Japanese Yen: 132K Long Vs. 36K Short – Net decrease in short interest. A large long position in Yen remains.
  • Euro: 137K Long Vs. 11K Short – Significant long position remains. No changes.
  • Australian Dollar: 126K Long Vs. 1K Short- Significant long position. Slight increase in long position. Massive long position remains.

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

Markets/Commodities/Volatility: 

  • E-Mini S&P 500: 223K Long Vs. 540K Short – Few changes. A substantial short position remains.
  • VIX: 75K Long Vs. 43K Short – No changes. A substantial long position suggests market turbulence ahead.
  • Gold: 85K Long Vs. 61K Short – Slight increase in net long exposure. Still neutral.

Conclusion: Based on the information above, commercial interests expect the stock market to decline as volatility surges higher. Gold is likely to remain within its trading range. 

Next Week’s Market Calendar: 

  • Q-2 Earnings.
  • Monday – Durable Goods
  • Wednesday – FED Interest Rate Decision
  • Thursday – GDP Data

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COT Reports & Weekly Market Calendar – July 24th, 2015 Google

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Shocking: How We Nailed This Week’s Market Top In Both Price & Time

Daily Chart Uly 24 InvestWithAlex

7/24/2015 – Another down day with the Dow Jones down 163 points (-0.92%) and the Nasdaq down 58 points (-1.12%).

I hate bragging, but as my friend Donald Trump says, “You Have To”. Earlier in the week my subscription service absolutely nailed the top on the Dow in both Price and Time. Since that point the Dow is down close to 600 points.

Further, if you are confused with this market, you are not alone. We are dealing with a very complex market environment here. A certain structure is about to complete and the market is about to move very fast. Something that my subscribers are very well aware of. If you would like to find out when we hit bottom and what happens next, please Click Here.

And instead of doing my regular weekly update, I will leave you this week with a few charts to consider. Of course, the conclusion you come to is entirely up to you.

The only other time the stock market was this expensive: 1929 and 2000 tech bubble.
PE Ratio

Inflation adjusted S&P: Setting in a double top.

S&P inflation adjusted

Dow Transports Are Not Confirming Higher Highs On The Nasdaq.

Dow Transports 5 investwithalex

NYSE (largest index by capitalization) hasn’t gone anywhere in 13 months. Now breaking below 200 day moving average.

NYSE Chart investwithalex

Massive divergence between collapsing macro data and stock valuations.

Macro Data InvestWithAlex

Smart money is selling while dumb money is buying. 

big investors investwithalex

Margin debt is at an all time high. Too much risk as everyone is too bullish. 

Margin Debt Investwithalex

If we are to repeat the environment when interest rates were this low last time, the S&P would have to lose 50-80% of its value. shiller pe with rates investwithalex

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. July 24th, 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: How We Nailed This Week’s Market Top In Both Price & Time  Google

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Why Kepler-452b Points To A Bear Market On Earth

new earth

I am sure you have heard by now about NASA’s identification of an Earth like planet. Finding Another Earth What does it have to do with today’s stock market? Quite a bit, allow me to explain……

Most people (75-90%) on this rock think in a linear fashion. For instance, most people still believe that that they are the only “intelligent” species in the Universe. Even though the evidence to the contrary is overwhelming. Consider this….

The discovery of Kepler-452b is not likely to see the public swoon with a collective rendition of Kumbaya. But this Earth 2.0 is a huge if under-appreciated discovery, not because Kepler-452b is unique but for just the opposite reason; there are likely thousands or millions or even billions of such earth-like planets in the universe. The discovery of just one such world is good evidence for many more: after all, we know of 100 billion galaxies each with as many as 300 billion stars (big variation per galaxy). Astronomers estimate that there are about 70 billion trillion stars. Math wizardry is not necessary to conclude we did not by chance find the only other possibly habitable planet among that huge population of stars.

Throw in life at different dimensions and we are now talking about real numbers.

Back to the stock market.  At today’s exuberant valuations levels, about the same amount of people believe that this bull market will continue indefinitely. And that is precisely why they are wrong.

z32

Why Kepler-452b Points To A Bear Market On Earth  Google