So writes Lou Basenese (www.wallstreetdaily.com) in edited excerpts from his original post* entitled Friday Charts: Three Trends You Won’t Believe Are Gaining Momentum.
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Dollar Bears Be Damned!
We’ve heard it for years. The U.S. dollar is doomed and its demise could happen any day now! Well, it’s time to replace the dollar as everyone’s favorite currency to malign…[because,] lately, courtesy of the banking woes in Cyprus and the ensuing flight to safety, the U.S. Dollar Index is up over 5% in the last two months [as can be seen in the chart below].
I know, I know, it’s merely a head fake before a massive collapse, right? [Wrong!] That’s what the dollar bears want us to believe but new research out of Deutsche Bank, however, suggests that we might want to think otherwise.
Go Global or Go Broke… Or Not!
Not long ago, analyst after analyst warned that the supremacy of U.S. stocks would come to an end and [that] those sorry investors who didn’t rush into traditionally much more volatile international and emerging markets would regret it big time…[The fact is, though, that] U.S. stocks…have been outperforming other global markets…[to the extent] that the United States’ share of the world’s total stock market cap keeps climbing.
If there’s one bold prediction I’ve taken serious heat for, it’s last February’s call that the real estate market hit rock bottom….[and now] that moment has officially arrived. [As can be seen below in the latest] reading for the widely tracked S&P/Case-Shiller Home Price Index prices increased 8% in January, year-over-year, [and] the trend is accelerating, too.
The recovery is legit. [Be that as it may, however,] the obvious investments are getting frothy [which] means, as I’ve noted before, it’s time to trim up our stops and think about putting new money to work in the sector elsewhere.
Editor’s Note: The author’s views and conclusions in the above article are unaltered and no personal comments have been included to maintain the integrity of the original post. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.
U.S. stocks are off to one of their best starts in years. Most indices are up 10% year to date, prompting many investors to ask: “Are we in another bubble?” The answer is no, at least when it comes to equities. Here are three reasons why:
The mainstream financial press would like us to believe that because the S&P 500 and Dow 30 are at or near their record highs that it must mean we’re nearing the end of the current bull market and, as such, now must be a terrible time to buy stocks. Let’s not jump to any conclusions, though. Instead, let’s do our own due diligence to find out. Hint: If you’ve been stuffing cash under the mattress since the last market crash, you might want to finally go deposit it in your brokerage account. Here’s why… Words: 420
While I remain cautious on stocks and the risk trade, the technical picture shows that the uptrend to be intact and the bulls should still be given the benefit of the doubt for now. At this point, any call for a correction is at best conjecture [as evidenced by the following 4 indicators]. Words: 399; Charts: 4
The Swimsuit Issue Indicator says that U.S. equity markets perform better in years when an American appears on the cover of Sports Illustrated’s annual issue as opposed to years when a non-American appears on the cover. [What is the nationality of this year’s cover model? Can we expect returns above the norm or will we see a year of underperformance for the S&P 500 this year? Read on.] Words: 323 ; Table: 1
As we all know, money printing always leads to inflation. It’s just a matter of figuring out which assets get inflated. This time around gold is not the only beneficiary, stocks are, too, and I’m convinced that the chart below holds the key to the end of the bull market. Words: 475; Charts: 1
Ever since the Dow broke the 14,000 mark and the S&P broke the 1,500 mark, even in the face of a shrinking GDP print, a lot of investors and commentators have been anxious. Some are proclaiming a rocket ride to the moon as bond money now rotates into stocks….[while] others are ringing the warning bell that this may be the beginning of the end, and a correction is likely coming. I find it a bit surprising, however, that no one is talking of the single largest driver for stocks in the past 4 years – massive monetary base expansion by the Fed. (This article does just that and concludes that the S&P 500 could well see a year end number of 1872 (+25%) and, realistically, another 28% increase in 2014 to 2387 which would represent a 60% increase from today’s level.) Words: 600; Charts: 3
For the month of January, U.S. stocks experienced the best month in more than two decades [and the Dow hit 14,009 on Feb. 1st for the first time since 2007]. Per the Stock Traders’ Almanac market indicator, the “January Barometer,” the performance of the S&P 500 Index in the first month of the year dictates where stock prices will head for the year. Let’s hope so…. [This article identifies f more solid reasons why equities should do well in 2013.] Words: 453
As Winston Churchill once said: “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty” and in that vain I challenge all readers to fight off the negativity, see long-term opportunity in global equity markets and, most importantly, remain invested. Your future self may thank you. Words: 732; Charts: 6
[In spite of all that is seemingly wrong with the U.S. economy] I think we are on the verge of entering the euphoria stage of this cyclical bull market where traders become convinced that QE3 is a magic elexir with no unintended consequesnces. [As such,] I see a strong acceleration and a significant and sustained breakout above the S&P 500 September high of 1475. (Words: 264 + 3 charts)