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Jeff Matthews

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

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

15 members have voted

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  1. 1. What's your prediction as to growth/loss in the DJIA from today (27,081) through 8/24/2020? (names and votes are public)

    • It will rise 10+%
    • It will rise between 5 and 10%
    • It will rise between 3 and 5%
    • It will rise between 0 and 3%
    • It will fall between 0 and 3%
      0
    • It will fall between 3 and 5%
      0
    • It will fall between 5 and 10%
    • It will fall between 10 and 15%
    • It will fall between 15 and 25%
    • It will fall between 25 and 35%
    • It will fall 35+%

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  • Poll closed on 03/27/20 at 03:08 AM

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Maybe not to everyones liking but, seems comprehensive enough to mount a plus to the market and

to all taxpayers. Thanks!

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On more than one occasion, I've asked Mr. Medwin to go to the HIGH price of Coke (KO) prior to the market crash of 1929 since he seems enamored about the values of that time period.

 

I've put slight effort into it today and can only find pricing going back to 1962 so I'm missing 33 years.

 

I'm pretty darn comfortable contending that the price of Coke stock 33 years PRIOR to 1962 was probably below the price IN 1962....but I wasn't there so we'll deal with what we have.

 

I contended that if someone bought KO at the high PRIOR to the crash of 1929, "why would they care" today that it's crashing down???  Their basis in the stock would be so small....

 

Here's a copy paste of what I found for 1962.  What you see below is a 1962 price of essentially .27 cents per share.  Now, this is a share adjusted price...  it might have been "$15" back then but, because of splits, the price would have dropped....

 

So, with KO today at $47, who would be agasint having bought it during the worst decline in the market in 1929???

Note that TODAY, KO's annual dividend is $1.64 so had you bought it in 1962 at .27, you would be netting today, a 500% rate of return annually.

 

How is that a bad thing if you bought it then and today, it drops 50% in value???

 

 

Date Open High Low Close Adj Close   
1/2/1962 0.263021 0.270182 0.263021 0.263021 0.004238  
1/3/1962 0.259115 0.259115 0.253255 0.257161 0.004143         
1/4/1962 0.257813 0.261068 0.257813 0.259115 0.004175            
1/5/1962 0.259115 0.26237 0.252604 0.253255 0.00408        
1/8/1962 0.251302 0.251302 0.245768 0.250651 0.004038         
           

 

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On 3/27/2020 at 3:08 PM, Coytee said:

On more than one occasion, I've asked Mr. Medwin to go to the HIGH price of Coke (KO) prior to the market crash of 1929 since he seems enamored about the values of that time period.

 

I've put slight effort into it today and can only find pricing going back to 1962 so I'm missing 33 years.

 

I'm pretty darn comfortable contending that the price of Coke stock 33 years PRIOR to 1962 was probably below the price IN 1962....but I wasn't there so we'll deal with what we have.

 

I contended that if someone bought KO at the high PRIOR to the crash of 1929, "why would they care" today that it's crashing down???  Their basis in the stock would be so small....

 

Here's a copy paste of what I found for 1962.  What you see below is a 1962 price of essentially .27 cents per share.  Now, this is a share adjusted price...  it might have been "$15" back then but, because of splits, the price would have dropped....

 

So, with KO today at $47, who would be agasint having bought it during the worst decline in the market in 1929???

Note that TODAY, KO's annual dividend is $1.64 so had you bought it in 1962 at .27, you would be netting today, a 500% rate of return annually.

 

How is that a bad thing if you bought it then and today, it drops 50% in value???

 

 

Date Open High Low Close Adj Close   
1/2/1962 0.263021 0.270182 0.263021 0.263021 0.004238  
1/3/1962 0.259115 0.259115 0.253255 0.257161 0.004143         
1/4/1962 0.257813 0.261068 0.257813 0.259115 0.004175            
1/5/1962 0.259115 0.26237 0.252604 0.253255 0.00408        
1/8/1962 0.251302 0.251302 0.245768 0.250651 0.004038         
           

 

 

 

OK Coytee, 

 

Since you are calling upon me by name, I will reply.

 

My response is meant to be a respectful one, and believe me, I do understand your line of thought.  I do not argue one iota, with your computations. 

 

Your thought process is only theoretical, highly flawed for several reasons, mainly - it is unlikely to APPLY to anyone today holding KO.    What percentage of people holding KO from 1962, are even alive today ?  Under 2% would be my guess.  You were a broker, or are a broker, what percentage of your clients hold positions for 58 years ??   Effectively, .. I would guess..... no one !! 

 

So, my first point is, your theoretical discussions are ONLY theoretical , this is inexpensive talk, something I abhor, vs actually DOING practical things. 

 

I find there is a huge difference between theorizing something, and actually getting things accomplished in the stock market, getting results that matter.

 

For an example, your thought process on this KO, is almost as weak as telling newbies to buy PUTS into a down market as it drops, when PUT option costs are ten times inflated. Ugh. A zero-experienced-newbie is buying from experienced Option sellers.   That was not a practical idea - at all.  ( VS ; in February 2020, my practical - easy to execute - very simple..... 95% Cash, 5% TVIX ).  Same applies, IMHO,  with your present "holding KO" idea.  More productive investment paths exist at the beginning of a probable major  Bear Market, in my opinion. 

 

What could anyone holding KO actually do, on 3-27-2020. holding such a stock as you have picked out ? 

 

This which follows is certainly is not meant as blanket investment advice, but here is how "I" personally would look at KO TODAY, if I were holding it..  Not theory, but an immediate plan of ACTION for me, I really like a lot .........what I would do for myself:

 

Basic Assumptions

 

1) KO closed 42.81, down $1.48 a share , or a 3.34% equity loss today. 

2) The most overbought Bull Market in History has just occurred,....... most say....... it is over.  

3) Bull markets of major proportions,  such as the two biggest tops in 1929, and in 2020,  do end........... in a Bear Market. The higher the Bull market, the larger the possibility of decline in a Bear market.

4) To this brief date, this has been THE most bearish Bear Market movement down, ever recorded, yet we are seemingly very early into it, have had NO capitulation, to end it.

 

                                  Look at this partial Point AND Figure Chart of Coke , "KO" , from Stockcharts dot com, 6 point reversal.:

 

                   

437945601_KOUSE.thumb.JPG.64402916f820a02f9d46576a1803491c.JPG

 

 

 As we all can see above, KO stock broke-out in April ( 4 ) 2007, to the upside, from $17.50 a share.  Its now ( off this chart ) trading at about $42.  The ideal uptrend line, the blue line from $12.00 a share, intersects into the future at about $19.00 .  I had previously suggested, KO looks like it could easily fall to 19 or 20 dollars in a long drawn-out bear market.  Any long drawn-out Bear Market equals sterling opportunities !!

 

Mind you all, I am bullish on the stock market, hopefully only at the right time. So what if I sell all my KO at 41- 42 dollars now, hold cash in a Bear Market, and when blood is on the street, buy TWICE AS MANY Coke "KO" SHARES, as I held before ?  I get the $1.62 dividend per share, on a doubled - share ownership position, if..... KO can maintain that pay out.

 

1044586812_KOedited.thumb.jpg.1ca40459513feba42f8531738d2d452a.jpg

 

In my personal opinion, we are in a monetary / financial SUPER CYCLE, the biggest in history.  Act accordingly, is what I suggest.  Trite but true, "the trend is your friend." 

 

Investors should do the following : do as you think is right for yourself, and be fully prepared to live with your decision's consequences.  I think, in general, people owning stocks should be proactive, not reactive.  Make and by all means, execute a proactive financial plan - a plan that is well-thought-out.

 

Do look up, the 1918 " Spanish " flu epidemic in Wikipedia, and please consider carefully  the "second wave" which occurred then, VS:..... us now in 2020 - 2021.  

 

Any and all of this post, reflects my own thinking, and is not meant to be Investment Advice for other people. Each must do, prudently, what fits their individual needs.  Do consider ALL the scenarios, all the possibilities, and proactively invest.   Also, I remind you again, be mindful of the trend. 

 

Best wishes to all of you.

 

Jeff Medwin 

 

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I can't speak to others....

 

But if directed at me....  yeah and it's killing me!!!  I'm forced to work from home right now.  I usually drive over 2,000 miles/month so I DO have extra time on my hands!

 

Since this is what I 'do', I'm already doing things like this so it's not taking any extra of my time, just a slight detour from my daily routine.

 

Still....  was a nice video!!

 

:emotion-21:

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Anyone care to make a precdiction?


Sent from my SM-N950U using Tapatalk

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Not that I really want to perpetuate this thread....but I'd like to raise (what I feel is) a serious point.

 

First and again, my congrats to @Jeffrey D. Medwin for calling this crushing market.  I was expecting the market to "go down" prior to the election and have been pounding that into the heads of the people I speak with (state employees) HOWEVER, in no way did I expect it to go down as brutally (and exactly like he said it would)....  so for that, I again, want to congratulate him.

 

But....that brings me to my point.....  Since this is the wild wild west of the internet.....there might have been people here or lurkers who took Mr. Medwin's comments dear to heart and if they did and capitalized on it, power to them.  There might be others who simply jumped out and saved their skins....and again, power to them.

 

He was so adamant (and again, was correct) that everyone should get out by "X" date....  and now that this has come to pass.....  I dearly hope that he will give us just as precise of timing on the best time to get back in.

 

If the market goes back to where it was and he caused someone to sit on the sidelines and they miss it, well.....  I think that is a bit of a disservice to them.

 

So, what are your thoughts/signals as to when someone should go back into the market to the degree they might have been in it prior to the downturn??

 

 

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47 minutes ago, Coytee said:

 for calling this crushing market

I thought that he had a thread about the market being interesting the particular week of his thread.  Nothing happened.  I never saw any mention of the markets reaction to the covid virus in his prognostication.   Had it not been for the covid virus we may be up over 30k currently.  NO ONE saw the effect that the virus would have on the economy in the early stages and around the time of his initial thread.

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Yeah....  I mentioned earlier in the thread about Elaine Garzarelli and her "one hit wonder" where she totally nailed the crash of '87 and became quite the guru.....but....  if you watched her career and especially now in hindsight, she never called anything else of significance. So in my view, she was a one hit wonder (she got lucky)

 

Calling the market to go down (prior to the election is my specific point of reference) might be easy to do for a variety of reasons but, to pull out the stops, total frantic "get the heck outta dodge" that we heard from him was in hindsight, brilliance.....  or, another one hit wonder.

 

What I'd like to see Mr. Medwin do is tell us/our world with the SAME FERVOR when it's time to get back in.....  if he's right, THEN one might start to give some credence to his forecasts.....  

 

There is the old saying that even a blind squirrel finds a nut every now & then....  well.....  is this his nut?  (shrugs shoulders)

 

Personally, if he's as good calling BOTH up and down with the accuracy and degree he called this one, I'm VERY open to keeping an ear on what he has to say....  (I'd be foolish not to at least use it as a datapoint)  However, if this was just a one-hit wonder.... 

 

So, Mr. Medwin, if it sounds like i'm disrespecting you, I'll say here & now, that is NOT my intent.  I DO however, think it's fair game to put your feet to the fire a bit since you jumped into this with both of them.  "Putting you to the test" so to speak.  

 

Don't leave us hanging....  well, I'll be ok.  Don't leave those that might have listened to you either directly or by lurking, hanging.  

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12 minutes ago, Coytee said:

even a blind squirrel finds a nut every now & then.

I almost put that exact phrase in my reply.

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2 hours ago, Coytee said:

If the market goes back to where it was and he caused someone to sit on the sidelines and they miss it, well.....  I think that is a bit of a disservice to them.

 

So, what are your thoughts/signals as to when someone should go back into the market to the degree they might have been in it prior to the downturn??

Just because he called it the first time doesn't mean he has to call it again.  

 

For those who listened to him, as you say, "Congratulations!"  Now, you're on your own.

 

I've been pressing Medwin for the same thoughts on when to get back in (not that I got out), and of course, his answer is, "When it hits the bottom."  He doesn't think it has hit bottom.  He thinks it is only half-way there (or less).  Take it FWIW.

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1 hour ago, CECAA850 said:

NO ONE saw the effect that the virus would have on the economy in the early stages and around the time of his initial thread.

... which is why I could kick myself in the pants!  How could you not see it coming?  By that time, China was shutting down in a huge way.  

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1 hour ago, Coytee said:

There is the old saying that even a blind squirrel finds a nut every now & then....  well.....  is this his nut?  (shrugs shoulders)

Let's just say I've been a blind squirrel all my life and never caught a nut like that.  TVIX up 20x!

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4 minutes ago, Jeff Matthews said:

Just because he called it the first time doesn't mean he has to call it again.  

 

 

Then he simply found a nut that by happenstance, coincided with the virus and got magnified.

 

In fairness to him, my wife said I had my head stuck in the sand.  Even through (what I now hope in past tense) was the worst of it, I wasn't bothered.  Doesn't mean I didn't LIKE it (and we were/are impacted by it)  I've just been to this dance before and my time horizon says "so what"....  it becomes a buying opportunity which is what I've been doing.

 

 

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9 minutes ago, Jeff Matthews said:

How could you not see it coming?

Because of all the intentional dis-information coming from China.  I think that people as a whole started taking it more seriously after seeing what was happening in Italy.  At that point it was obvious that it wouldn't be contained.

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Quite a rally for today so far.  If we are so obscenely broke and leveraged, who's bidding up all these prices?

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48 minutes ago, CECAA850 said:

Because of all the intentional dis-information coming from China.  I think that people as a whole started taking it more seriously after seeing what was happening in Italy.  At that point it was obvious that it wouldn't be contained.

I saw on the news this morning that Italy had DONATED PPE to China at the onset of this virus, now China is SELLING the gear back to Italy.  If true, what a jerk government they are.  it would be interesting to see the rest of the world give China a collective cold shoulder regarding everything. 

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3 minutes ago, BigStewMan said:

I saw on the news this morning that Italy had DONATED PPE to China at the onset of this virus, now China is SELLING the gear back to Italy.  If true, what a jerk government they are.  it would be interesting to see the rest of the world give China a collective cold shoulder regarding everything. 

It would be, but how can they turn down all of that cheap exploitable labor?

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Just now, oldtimer said:

It would be, but how can they turn down all of that cheap exploitable labor?

true ... and we (like the rest of the world) have painfully short memories. Unless it's someone or something that we don't like, then we remember things forever. 

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MODERATORS : NONE of what I say should be considered INVESTMENT ADVICE for others.  I have been asked what I NOW think, and I will freely express myself.

 

For the record, particularly for Carl and others to know, I did NOT know, nor did I care, what was going to cause the market to crash.  It simply doesn't matter to me.  Only so that you, the general public would " have a reason " to see what the MARKET was telling me , ( so for YOUR benefit, or to give you all an understandable reason ), I thought it was going to be Trump and Pence resigning, and Ms.  Pelosi as our new POTUSA.  I was wrong !!  OK.  Wanted to get you thinking.  Why?  Because I appeared from no where, and you didn't know me.  Nor was ANYONE in early 2020 psychologically prepared very well, for what I had to say.   I knew I would be scorned.  Ridiculed.  I was wrong about "the reason" I gave you, but I wanted  you all  to CONSIDER,  how those possible top-resignations could effect your stocks in Q1 / Q2 on, .....2020, on. 

 

When you are in the market 50+ years, and do technical studies, you never care or consider much about a fundamental reason, but rather, what does the market itself, from its technical signals - tell you, about what may happen..

 

I just believed something drastic would happen,  to "upset the apple cart". 

 

The February 2020 public's mindset unanimously was " I am waiting till Trump gets re-elected to take profits.........why, 2019 was just too profitable ".   ( AKA ...greed ). 

 

There is a great old stock market saying  I just love " If it is obvious to the PUBLIC, it is obviously WRONG ". It does not matter ( to me ) the "      reason " humans give, or ascribe to the market events, what really matters is what the market tells you technically, and how it moves.  You need not know each and every day, but you hopefully know at certain key times, such as when I specifically posted here !!.

 

I will again post the Stock Market Cheat Sheet Chart, and you will all again see, from a human psychological point of view, precisely where I think we are TODAY, and what will be the outcome.  I will tell you what I think, what lies ahead, technically.   

 

I may also show you the FIRST stock purchase I EVER made in my life, after I was a stockbroker for 18 months in 1970 !!

 

 

211894571_3-19-20WallStrretCheatSheet.JPG.6ca2ff811e6a554fce9d7453d337487c.JPG

 

From the above chart ( happens to be 1929 ) I feel we are in the mental " Complacency " part of the cycle.    LOL, one good day up and you guys are respectfully asking me questions.  As in 1929, it is possible that this 2020 snap-back Bear Market rally could last several months, as the market goes from technically oversold, to perhaps, I hope, overbought.

 

Mind you all, we have a GAP in all the current 2020 charts, ( that first Monday down ), and, like 1929, it may not get filled in my lifetime.  ( It took 21 years after 1929 top to get that top's gap filled, to get even, if the MEN didn't commit suicide.  Why, I'd be 96 !! )  1929 was the ONLY other bear market instance, that started - off with a unfilled Gap Down BTW !!  Let me show you another chart , of the S and P 500 , daily bar chart :

 

1404891244_SandPDailyEDIT1.jpg.f8d0ef3c599f7390b2b24126f17a3a57.jpg

 

 

Notice above, on the zero to 100 scale RSI chart , at the top of the chart, it traded mainly above 50 for the first 2/3rds of the chart - thats bullish, above 50 RSI.  Today, the daily RSI closed 49.89, below 50.  If RSI were to remain below 50, that would be bearish on a daily chart basis.   Notice how I have designated " DEATH CROSS" . Look that up, and learn what that means !!

 

                                                                         Next. lets look at the S and P 500 on an intermediate term, weekly bar chart :

 

263434910_SandPWeeklyEDIT2.jpg.f7390b065aa6abe02990d172c873f832.jpg

 

 

Here on this weekly bar chart, we can see the Q.4 2019 drop, when the RSI ( Relative Strength Index ) went below 50.  Generally speaking, when its above 50, it is a bullish market, and when it is below 50, it is a bearish market.  Usually, at the extremes ( considered above 70 and below 30 ) some use RSI as a market timing tool ( above 70, sell, below 30 buy, on a weekly basis).  Generally, usually....but not always !!

 

 

I personally like to use RSI a lot - when the Daily and Weekly figures - BOTH confirm each other.  Being pro-active.

 

In the heavy green circle, on the right hand side of the chart, we have the last four months :  Notice how, in Dec.2019 and January 2020, we were above 70 ?   I personally did my last buying of TVIX on January 10, 2020.  ( I have none now ).  Notice how we had the fastest drop ever in history, last month, and we got to below 30.   Notice, even with today's huge rally, and people becoming "complacent" on the Psychological chart, the RSI on a WEEKLY basis is still below 50 !!!  ( 40.05 = RSI today )  That is not yet  bullish.  The daily and weekly RSI have to simultaneously get and stay above 50, in step with each other, for this market to possibly become bullish.   

 

So, I would consider " the TREND is your friend "., and since we are below 50 on both  RSIs, and MOST of all, ...............since we have NOT had any real capitulation ( puking out of stocks ), I would personally consider the Bear Market to be in full effect, and, that this is just the first rally in a Bear Market.  I would guess, this market could take two years, or more, to bottom out.  Since 1929 was a 84 % wipe out of stock prices, I would expect 2020-on, to have the good possibility to be a 95% decline in stock prices.  Why, we started this 2020 Bear Market after an eleven year Bull Market - that exceeded 1929's over-valuations by about 50 %.  

 

Again, to remind you all,  I will outline what I think the possible future capitulation might look like :

 

(1) There will be LOTS of forced Margin Account selling, 

(2)  The public will be deathly afraid to purchase stocks, like its catching a falling knife 

(3) The "popular" stocks, on a one or two day basis, will get creamed.  " When they raid the "House-of-Ill-Repute" , they take the piano player also. " .

 

(3a) This means that MSFT may trade between $20 and $50 a share, interday.  AAPL ( which has not yet been hurt, and MSFT hasn't ) may fill its gap interday at $ 62 to $66 a share, if it doesn't hold at $150, a share.   WMT, easily at $60 or below.

 

(4) Tapes will be late on the downside,  Hard to get quotes. Markets may have erratic trading during the selling climax.   

(5)  Fantastic, record volume of shares traded

 

Mind you, IF it occurs as I believe it can, and as it usually does,  this will be THE sterling opportunity to buy stocks, FOR ME.  

 

                                          To fully address the idea of Jeff being " a squirrel finding a nut ", please read this :

 

 

Next, I would like to show you my ACCOUNT SHEET from when I was a 25 year old stockbroker, with only 18 months experience being registered officially.  Previously, I wrote that my Brokerage Graduation Class in NYC got registered, and sent to work,  right at the TOP, and the start of a 18 month market decline, on January 2, 1969.  I also described how in the last month of the decline, I witnessed a 30 year old new broker, and his 18 year old side kick, " tear 'em up" in an office of 60 brokers.  The other brokers were loosing client's monies daily, and these two guys were having a ball, shorting the market.

 

Finally , about two weeks before the bottom, 25 year old Jeff ( me ) walked up to 30 year old Larry, the broker, after trading closed,  and asked " can you teach me what you are doing. I was never taught this in Stock-Brokers Training in NYC ".  That was the start of a life long friendship, between us three guys.   About a week before the bottom, as stock prices were plummeting, and only Larry ( in an office of 60 stockbrokers ) was doing big business, these two guys SWITCHED from shorting to BUYING for clients.  Larry told me to get whatever money I had, and buy ( an odd lot of UCX ) University Computing   I did, and guess what, three neat facts. 1) this was the first stock account and stock purchase I had ever made for myself,  on 5-25-1970   2) The market bottomed, from an 18 month decline, only TWO days later and 3) like a young fool, I held it for only a few trading days !!!  My handwriting , below , my Account Sheet :

 

                                                                   1998795436_JeffsFIRSTaccount.thumb.jpg.b742a02e6d384a9a1a96f07dc7778196.jpg

 

                                                                                                Below, a chart of the 1969-1970 BEAR Market :     

 

                1371378606_3-29-201969-70BEARMARKETCHARTSAVEEDITED2.jpg.87c5beb343034df0743183d94a44aabf.jpg

 

I am mentally prepared to think that the Bear Market we have in 2020 will be a SUPER CYCLE Bear Market, as was the past 11 year Bull Market a Super Cycle event.   Are you prepared for that possibility, or are you "complacent"? ??   See below, precisely where we are .   

 

The trend is your friend.       Best wishes .

 

 

      15230845_4-7-20AverageoffourMarketValuations.JPG.e73e5be09e6d57f0dce29906d1d4f5e5.JPG

 

                                                                                                    

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