Analysis Topic: Stock & Financial Markets

The analysis published under this topic are as follows.

Thursday, August 01, 2019

US Fed Rattles Global Stock Markets / Stock-Markets / Stock Markets 2019

By: Chris_Vermeulen

Today is the day for the US Fed to announce their rate decision and we believe the 25 basis point rate cut is the only option they have at the moment that will attempt to settle foreign market fears and allow for a suitable “unwinding” of the credit/debt “setup” we highlighted in Part I of this research post.

We believe out August 19 expectation of a global market PEAK and the beginning of a price reversion move is related to multiple aspects of the timing of this Fed move and the current global economic outlook.  The unwinding of this debt/credit bubble will likely take many more years to unravel.  Yet, right now the US Fed is trapped in a scenario they never expected to find themselves in.  Either continue to run policy that supports the US economy (where rates would likely stay between 1.75 to 2.75) over the next 5+ years or yield to the global market and attempt to address a proper exit capability for this debt/credit “setup”.

Wednesday, July 31, 2019

Dow Stock Market Trend Forecast and AI Investing Update (2/2) / Stock-Markets / Stock Markets 2019

By: Nadeem_Walayat

This is part 2 of my July stock market trend forecast update. Much as expected the correction ended and resolved in a rally towards the trend forecast. With the Dow currently deviating from the trend forecast by about +1.5%.

Wednesday, July 31, 2019

Stock Market Expensive: Traumatic Correction Approaching / Stock-Markets / Stock Markets 2019

By: QUANTO

As S&P climbs to new highs and closes another week into 3000s levels, we believe that the ground underneath is starting to slip. The economy per say may not be the problem. However the same cannot be said about valuation. The S&P500 is valued over 100% to its traditional mean and median levels on price to earning ratio. The one month treasury yield is now above US 2 year and 10 year yield thus effectively inverting. Money is often borrowed in the short term markets. A rise in short term rate is a warning signal of the coming mayhem. Rising yield will force models to reset after certain threshold are hit and this automatically converts into equity market cash outs. This sets of a chain reaction as sell momentum can spread across.

THe current S&P earning yield is 4.5% down from 6% thus contracting the returns investors make. This becomes even worrying when the short term yield is closing in on the earning yield at its fastest pace in over 10 years. We believe traumatic correction is on its way.

Wednesday, July 31, 2019

Stock Market Medium-long Term Bullish Case From a Trend Following Perspective / Stock-Markets / Stock Markets 2019

By: Troy_Bombardia

The stock market is going nowhere as traders prepare for a rate cut. Today’s headlines:

1. The stock market’s MACD
2. S&P’s indecision is coming to an end
3. Put/Call remains very low
4. Finance stocks are finally going up
5. Materials are no longer lagging the stock market.

Monday, July 29, 2019

US Stocks Seem To Be Following Our Predictions – Get Ready / Stock-Markets / Stock Markets 2019

By: Chris_Vermeulen

In the first part of this multi-part technology sector research post, we highlighted our previous research and predictive modeling result that suggest the US and global stock markets are poised for a peak/roll-over within the next 30+ days.  Our predictive modeling systems and cycle analysis tools are pointing to August 19, 2019, critical inflection date that we believe will become the “breakdown date” for this next big move to the downside.

Part of our effort to help skilled technical traders is to provide research posts, like these, that highlight trade setups and allow our followers to understand the type of trading opportunities that are present for them to consider in the future.  We believe the next 30+ days will prove our predictions are accurate and that the US/Global stock markets will roll-over into a new bearish trend – likely breaking downward near August 19, 2019.

Monday, July 29, 2019

All Eyes on the Fed / Stock-Markets / Financial Markets 2019

By: Andre_Gratian

Current Position of the Market

SPX: Long-term trend – Finallong-term phase on the way?  How much longer, is the question.

Intermediate trend –  The continued strength has muddied the water and we may have to wait until August before the intermediate trend becomes more clear.

Analysis of the short-term trend is done on a daily basis with the help of hourly charts.  It is an important adjunct to the analysis of daily and weekly charts which discusses the course of longer market trends. 

Monday, July 29, 2019

Stock Market - Get Ready! / Stock-Markets / Stock Markets 2019

By: Chris_Vermeulen

As we near the important date of August 19, 2019, and we watch how the markets are reacting based on our earlier predictions, it is becoming evident that the US stock markets and global stock markets are following our predictions very well.  The fact that these markets are doing almost exactly what we predicted months ago suggests that our call for an August 19, 2019 breakdown in the US/Global markets should also align with price activity very well.

Saturday, July 27, 2019

Range Bound Financial Markets and Economy in Good Shape / Stock-Markets / Financial Markets 2019

By: QUANTO

Markets at all time highs and considerably calmer option market VIX index suggest that we could be in a slow grind higher for risk markets.

ECB Drahghi hits at easing

Christopher Graham, economist at Standard Chartered, notes that the European Central Bank (ECB) kept rates on hold at its 25 July meeting, but President Mario Draghi sent a strong signal that further easing would be delivered in September as per expectations. Key Quotes “By adjusting its forward guidance to note that rates would remain at current “or lower levels” until at least mid-2020 (in line with our expectations), the ECB has reinforced our view that interest rate cuts will be delivered after the summer break.” “We continue to expect a 10bps deposit rate cut in September and a further 10bps cut in December, to -0.60% by year-end.” “The Governing Council (GC) is also considering a broader package of measures; Draghi noted that committees have been tasked to explore other options, including new net asset purchases (both in size and composition), tiered deposit rates, and ways to reinforce forward guidance on policy rates.” “In a sign that the ECB has become increasingly concerned about the euro-area inflation outlook and persistently low inflation expectations, it also noted its “commitment to symmetry in the inflation aim”, implying that an overshoot of 2.0% would now be tolerated.” “The bar to other policy measures remains higher than for rate cuts, in our view, and Draghi admitted that agreement on the GC was not unanimous. Nonetheless, the likelihood of QE being restarted by year-end has increased considering press release, particularly if euro-area economic activity remains weak or deteriorates further.” “At the same time, we reiterate that a convincing QE programme would need to be open-ended and would require controversial rule changes, most likely a change to issuer limits.

Friday, July 26, 2019

Many Stock Investors & Traders Expect a Correction Over the Next Few Months / Stock-Markets / Stock Markets 2019

By: Troy_Bombardia

After a big 7 month rally, many investors and traders are expecting a pullback/correction sometime in the next few months. This begs the question: if everyone thinks this way, will they all be right? Today’s headlines:

1. A big 7 month rally.
2. “The stock market today is just like 1998.”
3. Volatility continues to fall.
4. Semiconductors v-shaped recovery
5. Gold:silver ratio continues to fall
6. U.S. Dollar’s extremely low volatility

These headlines are from CNBC:

Friday, July 26, 2019

The Stock Chart That Has the Fed in a Panic / Stock-Markets / Financial Markets 2019

By: Graham_Summers

Just what exactly is terrifying the Fed?

Over the last week, multiple Fed officials have surfaced to suggest the Fed needs to start cutting interest rates right now.

Indeed, on Thursday, John Williams, who runs the NY Fed (the branch in charge of market operations) suggested the Fed needs to cut rates to ZERO again.

Not 2%, or 1%, ZERO.

Friday, July 26, 2019

Next Recession: The Case For A 36% Stock Market Plunge / Stock-Markets / Stock Markets 2019

By: Dan_Amerman

If there is a recession in the next one to two years, there is also likely to be another bear market for stocks. Based on their experience over their lifetimes, many investors are expecting a "normal" bear market in that event, perhaps in the 20% to 25% range in terms of losses.

However, we are not in normal times, and we have seen a fundamental change in stock valuations over the last more than twenty years. We have also seen a major change in the losses experienced in bear markets, relative to prior decades.

This analysis takes a detailed visual look at the history of the S&P 500 stock index since 1962, and shows how the fundamentals have changed since the mid 1990s. Using simple averages, it then shows why the base case for a new bear market could be a two year inflation-adjusted loss of 36%, which would exceed anything experienced in the 1960s, 1980s or 1990s.

Thursday, July 25, 2019

Global Banking System Black Hole Being Exposed - PART II / Stock-Markets / Financial Crisis 2019

By: Chris_Vermeulen

Nearly a decade ago, the globe experienced the biggest banking system failures we had seen in nearly a century.  The exposure to risk that was inherent throughout the global banking system was so completely ignored that when the crisis unfolded, hardly anyone completely understood the depth of the risks at play.  Could it happen again?  Now?

Have foreign banking institutions extended credit and debt risks beyond safe levels again?  Are Deutsche Bank risk factors going to complicate an already fractured  Asia, China, and Europe?  What are the signs we should be looking for in terms of extended weakness or a breaking point?

Wednesday, July 24, 2019

Risk:Reward over the next few months Doesn’t favor Stock Market Bulls / Stock-Markets / Stock Markets 2019

By: Troy_Bombardia

The past 7 months saw stocks and bonds surge together (bond yields fell). With stocks trending sideways, bond yields are also bottoming. Today’s headlines:

1. Yield curve un-inverted
2. Leading indicator for the economy & industrial production
3. Put/Call ratio tanked
4. Consumer Staples surge
5. This defensive sector is no longer outperforming
6. Silver’s golden cross

Go here to understand our fundamentals-driven long term outlook. For reference, here’s the random probability of the U.S. stock market going up on any given day.

Wednesday, July 24, 2019

Black Hole In Global Banking Is Being Exposed / Stock-Markets / Financial Crisis 2019

By: Chris_Vermeulen

Almost a decade ago, the global financial crisis of 2008-09 exposed billions of people to the risks within the global financial/banking sector.  With all this money flowing around the globe and with banks able to facilitate greater and more diverse risk/derivatives investments, the central banks and insurance companies are left with an incredible “black hole” of exposed risk that is almost impossible to quantify.  When we add the shadow/gray market banking risks into this equation and begin to understand the complexity of commodity-backed or Purchase Order backed financing that has become commonplace throughout the planet, we have to ask ourselves one question – “what would it take for these risks to become another crisis?”

Tuesday, July 23, 2019

Stock Market Breadth Warning Signs for the Stock Market’s Rally? / Stock-Markets / Stock Markets 2019

By: Troy_Bombardia

As the stock market trades on light volume, various breadth indicators are flashing short term warning signs. Today’s headlines:

1. A real breadth divergence.
2. Weaker than average economic growth
3. Lagging margin debt
4. Baltic Dry Index surge
5. Gold:silver ratio
6. Netflix

Go here to understand our fundamentals-driven long term outlook. For reference, here’s the random probability of the U.S. stock market going up on any given day.

Tuesday, July 23, 2019

US Dollar Index tightly wound between: US Bond Yields down on safety flows / Stock-Markets / Financial Markets 2019

By: QUANTO

As markets begin a new week, there are interesting opportunities. SPX ended the week in a state of uncertainty. Weekend news from Iran seem to suggest there is no truce visible as Iran has not yet let go of the Oil tanker captured. It was flying a UK flag. US has not fully involved itself in the spate and thus market are waiting on a US response. However bond market seem to have made up its mind that they will not wait for a strike but rather exercise caution before its too late.

USDJPY has opened the week above 108. Above 108.4 the pair may look to extend gains to 109.2. The lack of impetus suggest we will fall to 105 on USDJPY.

Tuesday, July 23, 2019

Stocks Bull or Bear? The Market’s Message / Stock-Markets / Stock Markets 2019

By: Plunger

Today I would like to review the state two markets. The general stock market and the precious metals market. Following this I will give an update on Plungers Core-7 portfolio.

Consider this report an opportunity to read an alternative view of the markets. My views of the major averages are certainly at odds with consensus opinion. Furthermore, they are also at odds with the methodology of chartology. A strict interpretation of the charts will not lead to the conclusions I present here. I understand I am not in synch with the Rambus interpretation of the stock market, but he has been gracious enough to allow me to present it anyway.

The General Stock Market: Run!… Don’t walk away from this thing.

Identifying whether it is a bull or bear market is a more effective method to operate than focusing on individual stocks that may go up or down. Most investors however, are mainly engaged in stock selection and spend little time in deep thought as to the state of the averages. This directly relates to what I consider the most important thing in investing. That is aligning oneself with the primary trend.

Monday, July 22, 2019

Stock Market Increasing Technical Weakness / Stock-Markets / Stock Markets 2019

By: Andre_Gratian

Current Position of the Market

SPX: Long-term trend – Finallong-term phase on the way?  How much longer, is the question.

Intermediate trend –  The continued strength has muddied the water and we may have to wait until August/September before the intermediate trend becomes more clear.

Analysis of the short-term trend is done on a daily basis with the help of hourly charts.  It is an important adjunct to the analysis of daily and weekly charts which discusses the course of longer market trends. 

Monday, July 22, 2019

Stock Markets Setting Up For A Volatility Explosion – Are You Ready? / Stock-Markets / Stock Markets 2019

By: Chris_Vermeulen

Today, we are going to share with you some incredible charts that highlight why we believe all traders and investors need to stay keenly aware of the potential for very explosive moves over the next 6 to 12+ months.  We’ve authored a number of articles about super-cycles, Gold, Oil and dozens of other symbols suggesting that a deeper and more complicated economic shift is taking place throughout the world.  We’ve been following the trail of money and investments for many months and attempting to map out what we believe will happen in the future with our proprietary predictive modeling systems and adaptive learning utilities.  Get ready for some crazy price ranges and a big move in the markets over the next 30+ days.

Right now, we believe the US stock market is poised for another attempt to move briefly higher as a flood of earnings hits the news wires next week.  We are confident that the US stock market will attempt a move higher based on our predictive modeling systems and other technical analysis tools.  We want to warn you that this upside move will likely become a “wash-out high” price rotation where price rallies briefly, stalls, then reverses back to the downside fairly quickly.  We believe this “wash-out high” price pattern will set up and execute before August 5th or so.  Be prepared as this move may sucker in a number of new long traders just before it breaks lower.

Monday, July 22, 2019

What you Really need to Know about the Stock Market / Stock-Markets / Stock Markets 2019

By: Troy_Bombardia

If you read financial news & market analysis from pundits every day, it’s easy to be overwhelmed by countless charts, data, indicators, opinions, etc. In this post, I’m going to focus on what I think really matters for the stock market right now. A quick recap:

1. Long term risk:reward does not favor bulls
2. Fundamentals (next 6-9 months): favors bulls
3. Technicals (next 6-9 months): favors bulls (i.e. late cycle rally)
4. Short term: mixed/bearish