Bull Market Ending
The signs are all here but the main media choosing to ignore it. Here they are first off is the curve inversion this one is big with the bonds. The BIG money always gets out first and when they rather take a chance at treasures vs stocks it sounds an alarm that a recession is coming.
The next big sign is the following dow transports and according to the dow theory transports are the main engine of the economy and when it goes down so do the stocks and the transports failed to reach a new high ever since we had a top around Sep and Oct that is NOT a good sign.
Gold vs Oil. We have something unusual here Oil selling which is good for economy yet Gold going up usually with commodities Oil and Gold go together. Oil selling because of slowing world economy not because of too much supply as supplies already been cut a lot with many companies going bankrupts when the Oil bust happened. Gold going up because investors are nervous.
Talking about Gold looks like its going to break up soon to around $1800 after years of trading sideways and nothing happening. In fact Gold was in bear market for years maybe it is soon time for the shiny metal to shine again. What makes Gold so attractive is that its very limited supply on Earth and very big demand in fact all the Gold in the world can fit into 3 Olympic swimming pools.
Crypto Going up! Then crashing. This happens right before big turns in the stock market always you see some speculation plays getting into a bubble and crashing this is not different this time its always the same. I believe we might see Crypto going close to $20,000 then crashing back down hard to around 5,000.
FANG stocks fail to make a rebound. Also note the timing of the Justice Department investigation into monopolist tendencies of Apple, Google and Facebook. This is very similar to what happened with Microsoft at the end of the bullmarket in the late 90s. Those stocks are the leaders of the bull market they are Google, Facebook, Netflix and Amazon. I would also include Tesla and Apple as the leaders of this bull market. If they fail to make new highs it is not a good sign when the leaders not doing well.
The Spy tracks the S&P 500 all the biggest companies that makes money in the United States Stock market.
The end of bull market the leaders get to the top then go down and fail to breakout and start to fall. In fact in bear markets growth stocks lose 80% of value some lose 95% and never recover. What we have here is classic top formation forming with the SPY failing to pass 300 and triple top seems to be in play.
Recently now bad news is good news! Market going up but the stocks going up are mostly defensive plays and speculation stocks seem not to have the energy to break up. You can see some spec plays doing very poorly Snap, Tsla and DDD as some plays that are failing or break out of at all time lows. Also in bear markets stocks open in green and close in red. The professionals always pay attention to the end of the day! When you see this pattern of open green and close in red we are in a correction territory.
Fed says they will lower interest rates with the looming trade wars with China and now also with Mexico. For the Chinese it makes sense not to sign this deal and wait to see if Trump loses the election. Everything pointing all signs that bear market is here and you should either go to cash, play defensive or invest in gold.
Is 7 year Gold Bear market about to end and new bull market in Gold about to Start. A close above and sustainable break above 1400 and we could see Gold climb toward 1800 levels. For those levels to be triggered we would have to be in a recession. My money right now we are heading
toward 1400 so investing in Gold stocks for a swing trade is a solid bet.
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