I really hate this sort of typical Wall Street BS reporting. (read full article below).
- Money got nowhere else to go.
- Money will keep chasing stocks, blow off top still ahead.
- Put a stop loss 25% below today’s levels.
WTF? Why stop at the DOW 50,000. Let’s keep going my friend. This is absolute garbage and nonsense. Disregarding all of the fundamental, technical and timing issues associated with the statements above……… if putting a stop loss 25% below today’s levels doesn’t make this advice obsolete, I don’t know what will. The bottom line is as follows, you can listen to this garbage and lose a lot of money or you can follow our work.
As we have maintained for so long, the bear market of 2014-2017 is about to start. When it does, we will experience a very similar environment to what we have experienced between 2000 top and 2002 bottom (on the DOW). If you would be interested in learning exactly when this bear market will start (to the day) and it’s internal composition, please Click Here.
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The Dow Is Going To 50,000. Why not 100,000? Google
Breakout Writes: The case for Dow 50,000(Watch Video)
Today marks the official end of the first quarter of 2014 and most traders are happen to see it end. The S&P500 (^GSPC) managed to grind out gains but it took nerves of steel to effectively trade the gyrations. That’s one reason professional trader Tres Knippa takes the emotion out of it by staying long and rolling up his stop-losses.
It’s less that Knippa is “bullish” in the traditional sense of expecting improving fundamentals. He simply thinks the bubble is still in inflation mode.
“Money’s got no where else to go. A lot of people keeping talking about overvaluation. ‘The market has come too far too fast. I’ve missed the opportunity.’ I actually don’t think you’ve missed the opportunity.”
Knippa thinks we’re in the seventh inning of a bubble but maintains that’s where the most explosive moves are often made. The so-called “blow-off top” formation is the frenzied buying before the bottom falls out from long market runs. The most famous end of a bubble of the last generation was the 30% gain in the Nasdaq (^IXIC) from February 1st to the all-time high on March 10th 2000.
Whatever you think of the valuations and today they are nothing compared to what was going on during the waning weeks of the dot.com top formation.
Obviously it’s dangerous for investors to be caught long during an investment implosion but Knippa is unabashed about the upside potential. “I don’t think we’re ridiculously overvalued but I think we’re gonna become ridiculously overvalued. I think equities could double or even triple from here.”
His strategy for participating in the upside without getting completely wiped out is to stay long individual stocks and put in stop-loss orders 25% below his positions. The key is rolling those stops higher as the momentum continues.
For long-term investors Knippa’s strategy is absurd on the surface. The implications of what would be left in the wake of a bubble of that magnitude would be horrific. It’s hard to objectively hope such a scenario unfolds but Knippa is clearly devoted to the market he has, not the one he wants.
Knippa thinks stocks are going much, much higher. It’s an openly extreme call but long time traders know better than to question what’s possible.