Where are the stock markets headed over the next 6 months?

[Zen Traveler]

Just now, billybob said:

Whoops there it is... Again lol !

Fyi, it was in the original post by Coytee.

[Coytee]

Mods can delete my post if they wish.  Or, let me know and I'll delete it.  

[billybob]

3 minutes ago, Zen Traveler said:

Fyi, it was in the original post by Coytee.

That why the again... you are slipping part...ner.

[billybob]

Please do not take your selves too seriously like a certain gov I know.

[Zen Traveler]

Just now, Coytee said:

Mods can delete my post if they wish.  Or, let me know and I'll delete it.  

Sure. I have no problem with going further but don't wish to get Jeff's thread locked. Otoh, your comment does deserve a second opinion and I am comfortable with the status quo. 

 

[billybob]

32 minutes ago, Zen Traveler said:

Of course. Coytee didn't mention that.

I'm not sure what you are talking about here or the gist, but Covid-19 definitely isn't a "mild" virus. 

 

Btw, I relish a productive political debate but have been warned not to do so on this forum any longer. FYI.

Tightrope ride...🤠

[rplace]

On 8/7/2021 at 10:42 AM, Coytee said:

Not to be/sound/get political....but

I wish I had a dime for every time I heard a sentence in an entirely white crowd start off with....

 

I'm NOT a racist, but

[richieb]

45 minutes ago, rplace said:

I wish I had a dime for every time I heard a sentence in an entirely white crowd start off with....

 

I'm NOT a racist, but

Alert RP, Alert. You’re  coming very close to the third rail - ⚡️

[billybob]

...

[oldtimer]

38 minutes ago, richieb said:

Alert RP, Alert. You’re  coming very close to the third rail - ⚡️

Go ahead.  Pee on it.

[artto]

44 minutes ago, oldtimer said:

Go ahead.  Pee on it.

 

OK

 

[artto]

The following data and analysis are from The Sentiment Trader.

Highly Recommended.

 

I’m not supposed to be posting this but hopefully some of you find this insightful enough to at least try a trial subscription. I find their Historical – Statistical – Conditional analysis extremely useful. It’s not a trading strategy or model. Just the historical facts and what happened going forward.

 

What we are looking at here is the current extreme in the S&P500 PE Ratio and the VIX Volatility Index SPREAD.

 

“This indicator shows the spread between the forward price/earnings multiple on the S&P500 and the VIX volatility gauge.. The higher it is, the more investors are willing to value stocks while not suffering the consequences of high volatility, leading to poor future returns. A very negative spread shows that investors may be pricing in too great of a swing in prices relative to the earnings that stocks will likely be generating.”

 

In a nutshell, this indicator is where valuation and sentiment meet. The reason I bring this to your attention now is that it may soon be on the cusp of a potentially important signal.

 

The test looks for a day when the 50-day average of the PE/VIX Spread drops below 5. It doesn’t often happen, so a small sample size is a concern. Still, the intermediate-term results (2 to 3 months) seem worth noting.

 

 

 

The table below displays the results of previous signals. The key thing to note is the deeply unfavorable results registered 2 months and 3 months after previous signals (although after that, results were much better, so we are talking about an intermediate-term indicator).

 

 

 

The PE/VIX Spread 50 day average is presently above 5.00. There is no way to know how long it might be before this measure drops back below 5.00. However, it might make some sense for investors to play some defense over the subsequent few months – once it does.

 

All of the above is from last week’s The Sentiment Trader.

[oldtimer]

36 minutes ago, artto said:

I’m not supposed to be posting this

You're OK.  Only Medwin isn't allowed to post it.

[Fast996]

A look at Japans Grand Supercycle B top 1990 to 2021? With cycle C wave to begin?

The break in Silver and gold today is not a good sign.....too much debt and leverage in the world.

[Fast996]

Gold 

Hope I'm wrong but all these markets have B wave tops

B Waves are phonies with no real substance typically the last hurrah in manias 

That's it for me....I have a 300 year chart of the Dow that if it comes true would scare the crap out of anybody.

I'll keep that to myself....

Gold will have another bull market probably starting around 2023....SDR IMF reset?

[artto]

1 hour ago, Fast996 said:

Gold 

Hope I'm wrong but all these markets have B wave tops

B Waves are phonies with no real substance typically the last hurrah in manias 

That's it for me....I have a 300 year chart of the Dow that if it comes true would scare the crap out of anybody.

I'll keep that to myself....

Gold will have another bull market probably starting around 2023....SDR IMF reset?

 

 

Fascinating.

 

The DOW (Industrial Average) has only been around less than half that time. The DOW Transportation Average slightly longer.

 

"B Waves"

"C Waves"

Anything predictive in stock market analysis is bullshit. And that goes for Elliot's Wave Theory too. Entertaining? Yes. Interesting? Yes. Predictive? Not more than anything else can be including astrology.

 

It's in the "Anything works for a while" category.

 

Even the losers get lucky sometimes.

[artto]

The problem with charts like that is that the beauty is in the eye of the beholder.

 

Stretch that chart out and it starts to look like a horizontal line. Squeeze it and looks parabolic.

 

On top of that - the DOW? - The S&P500? - NDX?

 

So what. DOW = 30 US stocks, all large cap. S&P 500 = 500 US stocks, all large cap. There's really not enough "market" information in these Index anymore.

 

What does your analysis say about the Bond Market, especially as it relates to the Equity market? And of course Cash.

 

The value of cash is actually the "benchmark", not some indexes. 🤑

I'm a clear firewater guy my self, but Miller is OK. 👍

 

EDIT: By "cash" I am referring to the U.S. Dollar,  the return on the value of a dollar. For that I use the 1 to 3 month US Treasury Bill ETF (BIL)

[Travis In Austin]

7 hours ago, Fast996 said:

And of course this is the most important chart in the World.... [deleated, political commentary]

 

Some intelligence was starting to shine through until the political commentary. 

 

Hid the original, you can repost it if you can keep it politically neutral. 

 

Edit: I didnt realize @fast996 was responding, or adding upon an earlier political post.

[Travis In Austin]

On 8/7/2021 at 9:42 AM, Coytee said:

Not to be/sound/get political....but

 

1.  I don't think [deleated, political]

2.  I don't think [deleated, political]

 

I've had a number of people discuss this....  and how might they react.  My comments to them are essentially that it depends on how much they think something like that will happen and the effect they think it might have.  If their portfolio is doing well (most of what I see have averaged high teens to near 25% on a three or five year average)

 

[Well that an interesting time period to look at, 5 years. I guess they got out early last year and jumped right back in?]

 

Quote

 

So my comment to them is they 'could' take their current funds off the table, move them to a fixed account (earning a whopping 1% BUT out of the market so not going to go down IF a pullback happens)  but at this same time, keep their CURRENT contributions going into their CURRENT investment holdings BUT, now their "current" investment holdings are starting at ZERO since they may have just moved 50/75/100% of those funds to their fixed account to protect their gains. 

 

(On multiple occasions you have suggested a multitude of tools to limit losses in downturns without bringing up politics and future election cycles]

 

Quote

 

If the markets DO then pull back, then start dollar cost averaging the fixed account funds back into the market.

 

None of the above is intended to be/sound political......  but in the investing world, you have to look at your surroundings and things that may/will affect your portfolio.  In my opinion, one of the two situations stated above will likely happen and if one does, being prepared for it prior could be of benefit.

I'm sure it wasn't intended, but it's blatantly political. 

 

"I don't mean to bring up religion, but let me quote the Bible here as to why the market is going to skyrocket  . . . Again, none of the above is intended to bring up religion,  or sound religious, but in the investing world you have to be aware of your surroundings including what God is thinking."

 

Seriously?  

 

 

[Fast996]

9 hours ago, artto said:

The problem with charts like that is that the beauty is in the eye of the beholder.

 

Stretch that chart out and it starts to look like a horizontal line. Squeeze it and looks parabolic.

 

On top of that - the DOW? - The S&P500? - NDX?

 

So what. DOW = 30 US stocks, all large cap. S&P 500 = 500 US stocks, all large cap. There's really not enough "market" information in these Index anymore.

 

What does your analysis say about the Bond Market, especially as it relates to the Equity market? And of course Cash.

 

The value of cash is actually the "benchmark", not some indexes. 🤑

I'm a clear firewater guy my self, but Miller is OK. 👍

 

EDIT: By "cash" I am referring to the U.S. Dollar,  the return on the value of a dollar. For that I use the 1 to 3 month US Treasury Bill ETF (BIL)

Ok Here is the chart of the UST ZB_F 1week chart....you'll notice the bond made a 3 wave into the top....is it a "B" wave? Zero percent interest rates are a Fed manipulated anomaly. Going back 5,000 years interest rates have never been at Zero. Even in the Great Depression you had 2 pct rates. Now how much debt and leverage do you have in the WW system? a quadtrillion? At some point some of that will have to be liquidated ...maybe 50 to 75 trillion. Rates should rise as both lender and borrower will become suspect and borrowers will pay a higher rate to avoid insolvency.

So we have a possible top in the U.S. Treasury Bond as I count the pattern as nested 1,2's with latest counter rally wave 2 ending last week. If so the Bond should begin to collapse at some point. A possible thrust down through the neckline and then a retest of the NL and then a crash in wave 3 of 3 which is the strongest wave. The Black Swan in all of this is China which owns a large position in UST.

Of course if this does play out as I expect the USD would go to a new high.

We will see....