Most of the investors do wrong tings with their own portfolio right now. The future is very, very excited and I think we will see one of the biggest moves in a very long time. One of the biggests opportunities in decades.
It`s a lot of noice out there. The market we have today looks like the mid 90`s. That time, we saw a big rally. Bullish markets tend to go much higher then expected, and that can go on in a very long time. Now it is very similar.
In the mid 90`s we saw a rally because the bond market crached, and at the same time we saw a surge in interest rates. Money came from the bond market and got into the stock market. Bond hedge funds plummet.
Bond investors are running like crazy from bond funds now and $123 billion disappeared only in june this year. Today we see the biggest interest rates surge in at least 50 years. The growth is slow like it was in the mid 90`s. GDP was below 1% and China was slowing too. The volatility is very low.
It`s a lot of money on the way into the stock market. But investors will be more selective than never before. Stockpicking is the key. It seems to be very bad for weak stocks. Great stocks will do it much, much better. It will be a huge rally in superior stocks.
Europe`s largest economy, Germany, are growing faster now, and the second biggest economy in Europe, France, albeit marginally for the first time in nineteen months. It seems to be an upswing in the European markets right now.
Today I will look at these news:
S&P/CS composite at 9:00am
CB Consumer Confidence at 10:00am
It is the first day today that Goldman Sachs (GS), Nike (NKE), and Visa (V) are officially part of the Dow 30.
SPX is overbought and I see a rally in MACD. I think it will be a huge drop before february 15 2014. The drop can come earlier, but it depends on different things like Syria, Iran, QE or China to name something. Historically, the volatility is increasing from september to november. The week we are in now has a bad history. This week has been down seventeen times the last twentytwo years. It doesn`t mean it will happen again, but it`s something to keep in mind.
Take a closer look at the chart below. NYMO, or McClellan oscilliator, a measure of overbought/underbought conditions in the markets. It is at it`s highest since july 2011. At that point the market plummet 20%! It doesn`t mean that it will happen again, and I am not trying to make you afraid. It`s just statestics.
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