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Stocks & Equities

Nasdaq’s Achievement Topples Stock Market Crash Argument

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Posted by Sol Palha's Tactical Investor

on Friday, 27 October 2017 06:01

Financial experts love to spin lovely yarns

In fact, most of them appear to have chosen the wrong field; writing fables would have probably been a better choice.

The real phase of a bull market starts after it has taken out its old highs.  Until this moment occurs, it’s not a real bull market  The Nasdaq recently achieved this milestone; this was not an easy feat as it took the Nasdaq 15 years to break through the strong zone of resistance illustrated In the chart below.  A market normally doubles after breaking out to new highs, especially if it has been struggling to achieve this for 15 years.  Roughly it should trade to the 9800-10,500 ranges before putting in a long term.  Therefore until this occurs the most likely outcome is that it will experience corrections ranging from Mild to strong along the way up.

Nasdaq-April-20-2017

An expert who has stated the same thing over and over again hoping for a new outcome



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Stocks & Equities

"Does Yesterday's Selloff Have Legs?" - Morgan Stanley Answers

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Posted by Tyler Durden - ZeroHedge

on Thursday, 26 October 2017 06:41

Does yesterday's modest - if sharp - selloff in stocks have legs? That is the question Morgan Stanley's Institutional Equity Division director Chris Metli asks in a note to clients overnight. As Metli writes, the moves have been exacerbated by the lack of protection investors have on and their rising equity exposures over the last month. 

The below charts update the positioning in options and futures that QDS noted two weeks ago – in general investors have continued to get more bullish.  Meanwhile, as MS Equity Strategist Mike Wilson has noted 3Q earnings are now largely in the price and with the SPX rally overextended, earnings season should be a ‘sell the news’ event as there is "greater risk for a correction than we've seen in a while".

MS selloff 1

 

Larger Charts

....continue reading HERE



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Stocks & Equities

GOLDMAN SACHS: The fastest-growing investment product will see record demand next year — and that's good news for stocks

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Posted by Businessinsider.com

on Wednesday, 25 October 2017 06:54

gettyimages-84951211

  • Equity demand from ETFs will surge to a record in 2018, Goldman Sachs predicts.
  • Nonetheless, corporate demand for activities like buybacks will remain the biggest driver of stock demand next year.

Exchange-traded funds — which make up the most rapidly growing segment of the stock market — are showing no signs of slowing.

They'll attract $400 billion of investor demand in 2018, up 33% from this year, according to a Goldman Sachs forecast. To further boost the case for the so-called passive vehicles, Goldman estimates that actively-managed mutual funds will be net sellers of equities next year, shedding $125 billion of exposure.

screen shot 2017-10-25 at 83432 am.png

....continue reading HERE

 

 

 



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Stocks & Equities

Three Red Flags To Watch Closely in the Stock Market

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Posted by Mike Burnick - The Edelson Wave

on Tuesday, 24 October 2017 06:16

The Dow and S&P 500 notched new highs this morning. So what else is new? Stocks have been going through the roof pretty much all year with no let-up in the upside momentum, save for a few minor pullbacks of 3% or so.

I’ve been warning for some time now that this overbought, overvalued market is also way overdue for a correction. And I’ve been proven dead wrong so far. But the fact is, the longer it takes for a typical pullback to materialize, the more severe it is likely to be.

At the risk of sounding like a broken record, here are several bearish red flags to watch closely. That’s because any one – or some combination – of them could quickly pull the rug out from under the market …

Red Flag #1 – Bad breadth: Granted, stocks are hitting new highs almost daily. But I notice a glaring lack of conviction in terms of market breadth – fewer advancing vs. declining stocks, which you can see in the chart below – and fewer new highs.

Plus, trading volume has diminished steadily in recent weeks at a time of year when it typically picks up.

102317 1723 ThisisWhatC1

These are classic signs of a market about to run out of gas. And they tell me the long-awaited correction is finally looming.

Don’t get me wrong; I’m not expecting a repeat of the 1987 stock market crash, which took the Dow down 22% in a single day 30 years ago last week. But we’re way overdue for a typical 10% correction.

And there’s a long way for stocks to fall, because they’re so overextended to the upside right now …

Red Flag #2 – Stocks overextended: In addition to cycles analysis, I keep a watchful eye on several tried-and-true technical indicators of price action for the markets.



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More New Record Highs As S&P 500 Gets Closer To 2,600 Mark

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Posted by Paul Rejczak - Sunshine Profits

on Monday, 23 October 2017 06:52

Briefly:

Intraday trade: Our Friday's intraday trading outlook was neutral. It proved wrong because the S&P 500 index gained 0.5%, following higher opening of the trading session. The broad stock market accelerated its uptrend on Friday. There have been no confirmed negative signals so far. On the other hand, we still can see some short-term overbought conditions. Therefore, we prefer to be out of the market today, avoiding low risk/reward ratio trades.

Our intraday outlook is neutral today. Our short-term outlook is neutral, and our medium-term outlook is neutral:

Intraday outlook (next 24 hours): neutral
Short-term outlook (next 1-2 weeks): neutral
Medium-term outlook (next 1-3 months): neutral

The main U.S. stock market indexes gained between 0.4% and 0.7% on Friday, extending their long-term uptrend, as investors' sentiment remained very bullish following Thursday's rebound off support level. The S&P 500 index has reached new record high at the level of 2,575.44. The Dow Jones Industrial Average reached another all-time high at the level of 23,328.84. It accelerated its recent run-up, as investors were euphorically buying blue-chip stocks. The technology Nasdaq Composite was relatively weaker than the broad stock market. However, it reached new record high at the level of 6,640.03, around 0.1% above its Wednesday's high. The nearest important level of support of the S&P 500 index is now at around 2,565, marked by Friday's daily gap up of 2,562.36-2,567.56. The next support level remains at around 2,550, marked by previous level of resistance, among others. The next support level is at 2,540, marked by recent fluctuations. On the other hand, potential resistance level is at around 2,600. The S&P 500 index accelerated its uptrend, as it broke above recent consolidation. Will it continue even higher? There have been no confirmed negative signals so far. However, we can see some medium-term technical overbought conditions:

1

Close To New Record High



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