4/21/2015 – A mixed day with the Dow Jones down 85 points (-0.47%) and the Nasdaq up 19 points (+0.39%)

Short sellers, repeat after me….

• An opportunity to short Netflix (NFLX) at $570? Thank you Jesus (or whoever you pray to).
• An opportunity to short Biotech (IBB) at $364?  Praise the Lord.
• The Nasdaq is at 5,000…… Hallelujah.

On a more serious note, once in the while the stock market does something so utterly stupid, it takes your breath away.  What am I talking about? Today’s divergence between fundamental/macro data and the market’s bubble valuation levels. I wrote about it earlier Why The FED Has No Clue. Yet, despite this apparent ideal short trade setup, it’s not as easy as it sounds.

For short-sellers in U.S. stocks, the agony just piles on

“How are you supposed to actively short stocks in this environment? It has been impossible,” Seattle-based Fleckenstein told Reuters.

His frustration is shared by others dedicated to betting on declines, if not for the broader market then for individual stocks that look overvalued. Outside of the hard-hit energy industry, most sectors have performed well over the last several months, and dedicated short funds have been stung.

The biggest take away from the article above is not that short sellers have been unable to make money, but rather, the fact even the best researched and most successful short sellers are afraid to enter this market on the short side.

Isn’t that bullish? 

On the contrary. That suggests three things. First, everyone is already in. Just as they were at 2000 and 2007 tops. Second, the market has been distributing for close to 9 months. Finally, any upcoming bear leg is likely to be fast/violent. In other words, today’s short sellers should be grateful for the many amazing money making opportunities the market offers.

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. April 21st, 2015  InvestWithAlex.com

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Why Short Sellers Should Be Thanking GOD Google

4/17/2015 – A big down day with the Dow Jones down 280 points (-1.55%) and the Nasdaq down 76 points (-1.52%). 

The stock market continues to behave exactly as forecasted. If you would like to find out what happens next, please Click Here.

So, was it possible to predict today’s sell-off?

Sure, but you wouldn’t be able to forecast or anticipate it with the help of either fundamental or technical analysis.  You would need something more. You would need TIMING analysis.

Most investors measure the movements of their underlying financial instruments in PRICE only. That is a wrong approach. Don’t forget, all charts consist of two axis. Price and time. By concentrating only on the price portion of the equation, investors and analyst leave out 50% of necessary data. TIME data needed to make accurate stock market forecasts. In other words, we need to unify price and time.

To fully understand how to do that, get two free chapters of my book Timed Value. 

Let’s take a quick look at the real stock market example to see the amazing precision this particular technique can offer us.

I cannot overstate how amazing this chart is. Just a few points. (3-DV stands for 3-Dimensional Value)

• As we have already discussed, the move between 1994 bottom and 2000 top was 11,832 3-DV UNITS. The Dow topped at exactly 11,866 in January of 2000. Amazing!!!
• The up move between 1994 bottom and 2000 top was 11,832 3-DV UNITS. The down move between 2000 top and 2002 bottom was 6,483 3-DV UNITS. When you combine both values together you end up with a value of 18,315 3-DV UNITS. The move took 9 years.
• The up move between 2002 bottom and 2007 top was 10,156 3-DV UNITS. The down move between 2007 top and 2009 bottom was 8,137 3-DV UNITS. When you combine both values together you end up with a value of 18,293 3-DV UNITS. The move took 7 years.

To summarize, the combined move took 16 years and there was only 22 3-DV UNITS of variance between two sections. This variance over the 16 year period of time can be attributed to as little as 2 trading days and a few hundred points on the Dow. This example alone should put to rest all claims that the stock market is random and unpredictable. Once again, when we identify the exact structure of the stock market through using our 3-Dimensional analysis we can time the market with great precision.

For example, if we understand the structure above we know that the move between 2002 bottom and 2009 bottom will be identical in 3-DV UNITS of the move between 1994 bottom and 2002 bottom. Just by having this information alone one should be able to figure out the stock market with great precision. Further, once we have hit the 2007 top on the DOW, any analyst using this technique knows that the upcoming down move will be exactly 8,127 3-DV UNITS. (18283-10156=8,127)

That would mean that once the 2007 top is confirmed you would know exactly where the market would bottom. So, while everyone is freaking out in the late 2008 and early 2009 you are either shorting the market and making a lot of money or you are setting yourself up for the upcoming bull market that you know will start in March of 2009. Same thing or calculations apply to the December 31st, 2013 top on the Dow Jones.

I hope this clearly illustrates how powerful this type of an analysis can be.  Again, once the market structure is fully understood you would know not only where but WHEN the market would turn.

So, what does the future hold…….will we get another bounce (buy the dip) or is this sell-off just getting started? 

Well, my mathematical and timing work 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. April 17th, 2015  InvestWithAlex.com

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How It Was Possible To Predict Today’s Stock Market Bloodbath Google

4/16/2015 – A down day with the Dow Jones down 7 points (-0.04%) and the Nasdaq down 3 points (-0.06%) 

According to quite a few market pundits, the party in the equity markets hasn’t even started yet. Case and point

• Party in Equities Has Not Even Begun: Kotok

• Forget the Fundamentals, This Market Is About Just One Thing

I cannot stop shaking my head in disbelief. To save you some time, here is what was said:

“This is an extraordinary buying opportunity, buy any and all dips, with zero interest rates the price of equities could be infinite, this bull market will continue, valuation don’t matter anymore, etc….”

Valuations don’t matter……infinite run ups are just around the corner …..buy now. That sounds familiar. If I didn’t hear the exact same thing at 2007 and 2000 tops, well, call me a fool.

Again, the underlying assumption in both cases is the same. We are in such a unique monetary easing environment that there is no way in hell the markets can go down. Maybe so, but here is the major point that most investors miss. Today’s market environment becomes a matter of psychological setup as opposed to a fundamental background.

When everyone and their day trading grandmother believe that we are in such a bullish environment, the market is getting ready to reverse. Why? Well, it’s rather simple, everyone has already bought into the long side of the market. Contrary to the opinion of the market pundits above, I would argue that the only opportunity here is on the short side (or in cash).

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. April 17th, 2015  InvestWithAlex.com

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Shocking: Why The Stock Market Deserves Infinite Valuation  Google

4/15/2015 – A positive day with the Dow Jones up 74 points (+0.41%) and the Nasdaq up 34 points (+0.68%). 

Something strange is in the air. While most people will agree that we are heading towards some sort of an economic storm, most believe we won’t see any major trouble before 2017-2018, even as late as 2022. So much so that St. Louis Fed President James Bullard believes the US Economy is about to boom.

Fed’s Bullard says rate hikes are needed for coming ‘boom’

Now, wait a second. Let’s bring an ounce of common sense to the statement above. Since 2009 bottom we have lived in an environment of zero interest rates and 3 massive capital infusions in the form of QE. And even with all of that money floating around the US Economy has failed to show any signs of a “Boom”.

Sure, our capital markets have experienced a massive boom, but as I have shown here so many times before, the US Economy is rolling over and accelerating down.

Bullard: We risk a market bubble if we don’t move on monetary policy

“A risk of remaining at the zero lower bound too long is that a significant asset market bubble will develop.”

Earth to Bullard: We are already in a massive bubble. It is already too late. And you don’t need a fancy Harvard Ph.D. nor do you have to look further than the chart below to fully realize that. Take a look.

The market is now more expensive than at 1907,1937, 1966,1972 and 1987 tops. Just as expensive as at 1929 and 2007 tops. Only 2000 top stands above (due to the tech bubble and the lack of earnings at that time  – arguably that number can be dismissed). And the charlatans at the FED have the audacity to claim that there is “No Bubble”? Despite QE, zero interest rates, stock buybacks, high margin debt, etc…. Seriously, WTF?

This leads me to stand by my earlier statement. The FED has no clue.  

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 15th, 2015  InvestWithAlex.com

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The FED Expects An Economic Boom, WTF? Google

4/13/2015 – A down day with the Dow Jones down 81 points (-0.45%) and the Nasdaq down 8 points (-0.15%). 

The stock market continues to behave as forecasted. If you would like to find out what happens next, please Click Here.

Despite the appearance of having complete control over our financial markets, the FED might lose that power of perception fairly soon. And once the FED trade goes, the markets should implode. I have long argued that the FED has no idea of where we are and what their reckless QE and zero interest rate policy has done.  Case and point…..

Exclusive: Fed’s Williams sees less risk of rate retreat after lift-off

“So even if the economy got some bad shocks, really you are probably just talking about flattening that path out a bit, or maybe raising rates more slowly.”

Economic lift-off……what economic lift-off? See, I told you they were clueless. Over the last few months I have presented at least a dozen data points showing that the US Economy is rolling over and accelerating down. (Ex: chart below). Plus, forward earnings and guidance are expected to be adjusted lower due to the strong dollar and the same economic issues. We should see the evidence of that in Q-1 reports.

Finally, no matter what the FED says, asset bubbles do not translate to strong economic growth. The view Mr. Williams has is identical to the view Mr. Bernanke held in Q-1 of 2008. As the FED minutes revealed, Mr. Bernanke was concerned about overheating the economy and the housing sector. The 2007-2009 bear market was pushing into its 6th month by that point.

That is to say, don’t rely on the FED to make your investment decisions. And if you do, you will pay dearly for it.

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 13th, 2015  InvestWithAlex.com

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Why The FED Has No Clue Google