Posts by The Trend Letter

Headlines_sm

Headlines – February 16/18

  • Stocks flirt with 6-day rally; Nasdaq set for best week since 2011. Read story
  • Oil output cuts and electric car influx could hit Russia economy: central bank. Read story
  • Ninth grader arrested after threatening “Round 2 of Florida.” Read story
  • US rejects China-led bid for Chicago Stock Exchange. Read story
  • Bitcoin retesting the $10,000 level – why it’s so important. Read story
  • US housing starts soar in January, building permits hit 10.5-year high. Read story
  • Why Warren Buffet is a ‘prime example’ of the failure of American capitalism. Read story
  • Proposal for universal pay: tax high tech. Read story
  • Peter Thiel: ‘Silicon Valley is a one-party state.’ Read story
  • Intel says 32 lawsuit filed against company over security flaws. Read story
  • Bitcoin energy use in Ireland set to overtake homes, says local firm. Read story
  • Everything you need to know about the $1.8 billion PNB-Nirav Modi fraud. Read story
  • Amazon’s push into fashion retail should scare these companies the most. Read story
  • Russia is taking over Syria’s oil and gas. Read story
  • Romney to run for senate in Utah. Read story
  • On the lighter side. Check it out!

Stay tuned!

Headlines_sm

Headlines – February 15/18

  • 17 killed in mass shooting at Florida high school. Read story
  • Football coach ‘died a hero’ shielding students from gunman. Read story
  • Wall St opens higher as inflation fears ebb. Read story
  • Brace for another nose-dive for stocks – and welcome it. Read story
  • Billionaire Charlie Munger says ‘bitcoin is noxious poison.’ Read story
  • The number of crypto hedge funds soars amid bitcoin volatility. Read story
  • Buffet adds Apple, dumps IBM. Read story
  • The billionaire who allegedly swindled $1.8 billion from an Indian bank. Read story
  • Bombardier reports 57% rise in profits. Read story
  • McDonald’s plays ‘hide the cheeseburger’ in new Happy Meal health push. Read story
  • Hyperinflation meets tech: Cash-scarce Venezuela sees boom in payment apps. Read story
  • China demands clampdown on ‘vulgar’ quiz apps. Read story
  • Hedge fund Bridgewater makes $22 billion bet against European firms. Read story
  • FDA approves first blood test to detect concussions. Read story
  • Philosophers are building ethical algorithms to help control self-driving cars. Read story
  • On the lighter side. Check it out!

Stay tuned!

Headlines_sm

Headlines – February 14/18

  • Wall St reverses course to trade higher. Read story
  • Consumer prices jump more than forecast, sparking inflation fears. Read story
  • OPEC will be forced to play ‘second fiddle’ to the US in 2018. Read story
  • More fund managers now see danger ahead for the economy than at any time in the last decade. Read story
  • Trump lawyer admits paying porn star. Read story
  • Advertisers tuning out TV in sign of trouble for media companies. Read story
  • How a volatility investor made 6,000% while everyone else lost $2 billion. Read story
  • Credit Suisse CEO defends enabling volatility bets with XIV: ‘It worked well…until it didn’t’. Read story
  • Canadian Securities exchange launching blockchain-based clearing house challenging TMX. Read story
  • An Indian bank just uncovered $1.7 billion fraud at a single branch. Read story
  • Wall-Mart goes to cloud to close gap with Amazon. Read story
  • SA’s Zuma: ‘I’ve done nothing wrong’, sees no reason to step down. Read story
  • Photographer captures an impossible photo of a single atom. Read story
  • On the lighter side. Check it out!

Stay tuned!

Markettop

Key short-term targets for the S&P 500

In the latest issue of The Trend Letter, we identified the following Key Target areas for the S&P 500. On a timing basis, this next week, starting today, should see the next short-term trend.

The futures pointed to a lower opening, which fits our model’s forecast for slide over the next week. Here are the numbers to watch:

Near-term Resistance = 2697
Key Resistance = 2873
Immediate Support = 2585 (Note: this is the 150-DMA)
Near-term Support = 2535
Key Support = 2473

SPX0214

Today we expect to see some volatility, so watch for initial weakness, based on the inflation data, then a potential spike up to 2697, then another slide over the next week, targeting 2535, then the Key Support at 2473 by February 20th.

Stay tuned!

February 13/18

  • Dow opens 160 points lower, as stock market threatens to halt 2-day climb. Read story
  • ‘Risks of recession’ are rising, says head of world’s largest hedge fund. Read story
  • Kim Jong-un hails ‘warmth’ with South, calls for further reconciliation. Read story
  • VIX manipulation costs investors billions, whistle-blower says. Read story
  • Virtually no one is reporting crypotocurrency profits to IRS. Read story
  • US to push ‘reciprocal tax’ on trade partners: Trump. Read story
  • Tax-haven firm owns 23,000 UK properties. Read story
  • South Africa’s ruling party has finally fired president Jacob Zuma, and yet he hangs on. Read story
  • New York Times CEO admits print facing expiration date. Read story
  • Remington is planning to file for bankruptcy. Read story
  • US strikes kill hundreds of Russian fighters in Syria. Read story
  • Baltimore is at 11 days without a homicide – longest streak since 2005. Read story
  • South Korea’s ‘penis park’ draws Olympic crowd. Read story
  • Egypt’s former anti-graft chief taken to military prosecutor, family says. Read story
  • On the lighter side. Check it out!

Stay tuned!

Headlines_sm

Headlines – February 12/18

  • Stocks rebound globally crude oil snaps sell-off. Read story
  • White House to roll out Trump infrastructure plan. Read story
  • Oil bears in control, but expect a bounce. Read story
  • Bitcoin inches closer to $9,000, with cryptos higher across the board. Read story
  • Investors brace for more swings as US inflation specter rises. Read story
  • Pence raises prospects of talks with North Korea. Read story
  • South Africa: ANC leaders expected to ask President Zuma to resign. Read story
  • Israel warns over Iran’s presence in Syria after air strikes Read story
  • German court rules Facebook use of personal data illegal. Read story
  • New York state sues Weinstein company. Read story
  • Young Americans no longer use Facebook. Read story
  • On the lighter side. Check it out!

Stay tuned!

Headlines_sm

Headlines – February 9/18

  • US stock benchmarks surge at open. Read story
  • Euro set for worst week since 2006 as dollar extends rally. Read story
  • Trump signs spending bill, ending short shutdown. Read story
  • Nearly one-third of S&P 500 stocks are in a bear market. Read story
  • Oil slides toward weekly loss on excess supply worries. Read story
  • Turkey rolls out domestic rival to WhatsApp, raising surveillance concerns. Read story
  • Pence skips Olympic meal with N. Korea. Read story
  • ‘Trump’ and ‘Kim’ thrown out of Opening Ceremony. Read story
  • Jim Cramer blames group of ‘complete morons’ for blowing up the market. Read story
  • We still don’t know if cell phones cause cancer. Read story
  • Amazon to deliver Whole Food groceries in 2 hours for Prime users. Read story
  • Russian nuclear scientists arrested for ‘Bitcoin mining plot.’ Read story
  • How the rise of drones is creating a security nightmare. Read story
  • On the lighter side. Check it out!

Stay tuned!

marketselloff

Another wild day for the markets, now officially in a correction

Emotion is most investors worst enemy, as herd following is too powerful for most to avoid. It is the reason that retail investors buy most at the top, and least at the bottom in a market cycle.  It is a basic swing between fear and greed. As the markets  continued to rise, we saw investor sentiment quickly rising as more and more investors who were on the sidelines felt they were missing out, so greed drove them to jump in. The Fear of Missing Out (FoMO) creates anxiety for those who see how the markets are rising, and hear others discuss how their portfolio is thriving. They finally can’t stand it any longer, and jump in, right at the top.

Back on January 23rd we posted a blog titled “Markets keep rising…do you have an exit strategy?”In that blog we showed four technical indicators that warned of a looming market top. Sure enough, three days later the equity markets hit their high and have been falling ever since. After today’s massive decline, markets are now officially in a correction (defined as a decline of 10% or more).

After Monday’s record setting sell-off of 1,175, the Dow had another huge decline today, as it plunged another 1,032. Since the January high, the Dow is down over 2,700 points, and 10.46%.

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The S&P 500 was down 100.66 points today, and is also now in correction territory, down 10.28% from its January high.

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The Canadian TSX Index continues to be one of the worst performing markets in the world.

TSX0208

After a 15 months of ‘risk-on’ sentiment, volatility came back with a vengeance in the last week.

Vix0208

With inflation expectations, capital is flowing out of bonds, pushing yields higher. The 10-year US Treasury yield is now 2.85%. As we get closer to 3%, we will see some capital move out of riskier corporate and junk bonds, into the ‘perceived’ safer government bonds, paying 3%.

US10y0208

With the equity markets crashing, gold is not acting as a safe haven. This fits with our model’s forecast that gold’s time will come, but not just yet. It will rise as the confidence in government declines. That time is coming, be patient. We will discuss gold in a future blog.

gold0208

We understand that severe moves like we have seen in the last week can be very hard to watch, especially if you did not have a strategy to survive such a move. We have been warning for a couple of months that the further this bull market rises without at least a meaningful pull back or correction, the deeper and quicker  that decline would be.

Below are the numbers to watch as wee move forward. Before we get to those, take a moment and think about what your strategy is to protect your wealth.  We are still quite bullish for the equity markets, but that doesn’t mean that we have no strategy to protect ourselves for violent down moves such as we are seeing today. In fact, our hedging service Trend Technical Trader (TTT) has a number of positions that are profiting from these downside moves.

For those of you who have not yet taken us up on these offers, seriously consider doing so…it’s your money – take control!

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What to watch for:

We continue to see early/mid March as a Key Turning Point, producing either a near-term top or bottom. The next few weeks could be extremely volatile, so pay attention.

Bullish scenario: In the bullish scenario we need to see the S&P 500 make an immediate move higher to close above 2700, 2765, and then push back through its January high of 2875.

Bearish scenario: In the bearish scenario we need to see the S&P 500 drop below 2555, 2510, and then 2465.

SPX10208

The markets have gone from extreme overbought sentiment, to now slightly oversold, so we could see some bottom fishing, as aggressive investors try to catch a falling knife. We forecast that while 2017 was a very quiet and calm year for the markets, 2018 is going to be a wild one. It is certainly starting off that way.

Stay tuned!

Headlines_sm

Headlines – February 8/18

  • Wall St falls as investors remain on edge. Read story
  • Bulls vs bears: taking sides on the stock market. Read story
  • Broader cryptocurrency ahead? Depends where you are. Read story
  • 32% of Canadians nearing retirement with no savings: Poll. Reads story
  • If you’re freaking out about the stock market, remember why you invested in the first place. Read story
  • BC and Alberta in trade war over pipeline. Read story
  • Trump’s offshore oil drilling plan draws protest in California. Read story
  • Uranium One informant makes allegations that Russia sent $millions to Clinton foundation. Read story
  • This state has the highest number of millionaires for 7 years running. Read story
  • US body brokers supply the world with human torsos, limbs, and heads. Read story
  • India’s antitrust watchdog fines Google for abusing dominant position. Read story
  • North Korea holds pre-Olympics military show. Read story
  • Sleep deprivation seems to have the opposite effects in healthy and depressed people. Read story
  • On the lighter side. Check it out!

Stay tuned!

Headlines_sm

Headlines – February 7/18

  • More stock market turbulence. Read story
  • Forget the stock market roller-coaster, the sell-off in bonds is what matters. Read story
  • Cryptocurrency price surge: Bitcoin, Ripple and Ethereum all rising as markets recover. Read story
  • XIV trader: ‘I’ve lost $4 million, 3 years of work and other people’s money. Read story
  • Icahn: The market will one day ‘implore’ because of these wacky funds using so much leverage. Read story
  • Millennials are afraid stocks are too risky, so they are buying bitcoin. Read story
  • Congress seeking bigger budget deal while avoiding government shutdown. Read story
  • Kim Jong-un’s younger sister to attend Winter Olympics as part of North Korea’s delegation. Read story
  • 7 biggest worries that could hammer Tesla’s stock price. Read story
  • Merkel’s conservatives and SPD clinch German coalition deal. Read story
  • Peter Strzok text: Obama ‘wants to know everything ‘ about Hilary Clinton probe. Read story
  • A Houston company dumped cancer causing chemical into drain sewer. Read story
  • SpaceX oddity: how Elon Musk sent a car towards Mars. Read story
  • Trump plans to ‘top’ France’s military parade. Read story
  • On the lighter side. Check it out!

Stay tuned!