Timing & trends

Timing & trends

Extreme Fear & Still More Bears Than Bulls

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Posted by Bespoke Investment Group

on Thursday, 05 April 2018 16:50

Screenshot 2018-04-05 16.45.01


Last updated Apr 5 at 6:30pm

Even with the market rising 1000 points in 3 days investor sentiment is still extremely fearful and there are more bears than bulls. When there are this many bears and fearful people historically the chances are the market has seen, at the very least, a temporary bottom. R. Zurrer for Money Talks

Still More Bears Than Bulls

The weekly AAII bullish and bearish readings are meant to track individual investor sentiment towards the stock market. While bullish sentiment remained low for nearly all of 2017 (as the S&P 500 went up and up and up), it spiked up to the high 50s just as the market was peaking in January. The first 10%+ correction for the S&P 500 since early 2016 ensued, and like clockwork, the AAII bullish reading collapsed back down to the high 20s/low 30s.

AAII surveys individual investors on a weekly basis, and this week the bullish sentiment reading took a very small dip to 31.9%. At the same time, the AAII bearish sentiment ticked up very slightly to 36.64%. Given that sentiment readings are generally viewed as contrarian, it’s bullish to see more bears than bulls.



Timing & trends

Stephen Todd: Complex Bottoming Process

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Posted by Stephen Todd - Todd Market Forecasten Todd - Todd Market Forecast

on Wednesday, 04 April 2018 05:38

This monthly newsletter covers all major markets, Stocks, Bonds, Gold Canadian Markets and current market sentiment. This author is definitely worth reading. His hotline recommendations have yielded over 15% compounded since December 31, 2010. On his more conservative long term performance Stephen is ranked as one of only four services to have beaten the buy and hold over the past ten years - R. Zurrer for Money Talks 


It's Monday morning. I'm putting the finishing touches on the April newsletter and the market is not looking very good. In fact, it's getting mangled. It's my belief that we're putting in a trading bottom, but it's very choppy right now.

Most of the technical gauges that we look at are oversold and sentiment is showing a lot of bearishness on the part of option buyers and investment advisors. This is what you expect at an inflection point.

A good example of oversold is shown in the chart below. The five week moving average of advances minus declines on the NYSE is approaching minus 500. This is the level which has seen some very good trading bottoms over the past months.      



We're finally seeing some bearishness come into the American Association of Individual Investors survey. This is the part that has been missing from the overall bearish sentiment figures. Now, it's finally happening. When this survey shows 35% bears, we tend to be near some sort of multi week rally.



We're bearish on gold, but the yellow metal probably isn't too far from a tradable bottom. RSI is rapidly approaching an oversold condition and the price isn't far from support. 



Timing & trends

Technically Speaking: The Death Of Bull Markets

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Posted by Lance Roberts - Real Investment Advice

on Tuesday, 03 April 2018 07:27

Lance also answers the question on everyone's mind, is the 9 year bull market in stocks over? He also updates current market trends and highlights shorter-term investment strategies, risks, and potential opportunities. - R. Zurrer for Money Talks

The big question for investors at the moment is whether the 9-year old bull market has finally come to its inevitable conclusion or is it just a “pause that refreshes?” 

While the optimistic “hope” is that this is just a pause within a continuing “bull market” advance, from a money management standpoint getting the answer “right” is vastly more important to long-term investing outcomes.

The easiest way to approach this analysis is to start with the following basic premise:

“Bull markets are born on pessimism, grow on skepticism, and die on euphoria.” -Sir John Templeton

Take a look at the chart below which is Robert Shiller’s monthly data back to 1871. The “yellow”triangles show periods of extreme undervaluation while the “red” triangles denote periods of excess valuation.


Not surprisingly, 1901, 1929, 1965, 1999, and 2007 were periods of extreme “euphoria” where “this time is different” was a commonly uttered phrase.

What about today? Is this another period of “euphoria” or are investors still maintaining enough “skepticism” to fuel the bull market further? Unfortunately, there is little evidence investors are “skeptical” of much of anything right now.

“However, for now, there is little doubt the bullish bias exists as individuals continue to hold historically high levels of equity and leverage, chasing yield in the riskiest of areas, and maintaining relatively low levels of cash as shown in the charts below.”



Timing & trends

It's Not Yet Time for Gold....

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Posted by Jordan Roy Byrne - The Daily Gold

on Monday, 02 April 2018 05:59

This analysis as well as Martin Armstrong's Quarterly Closing Post clearly state that it is just not Gold's time to explode upwards. Jordan indicates below the factors that will have to fall into place before Gold can begin a long term bull swing upwards - R. Zurrer for Money Talks

Last week we noted that Gold’s quarterly close would be a key marker for Gold’s immediate breakout potential. Gold was seemingly on course for its highest quarterly close since 2012 until it reversed back below quarterly resistance at $1330/oz. Hence, an imminent break to the upside is unlikely and gold watchers will have to remain patient. It’s not yet Gold’s time. It will be soon enough. 

One catalyst for the most recent strength in Gold (the correction in equities) appears to have faded as the S&P 500 has held its 200-day moving average. A sustained rebound in equities while bond yields correct would not be particularly bullish for Gold. The obvious reason is capital is flowing into equities and not Gold. A rebound in equities amid a temporary reduction in inflation expectations would equate to stable or rising real yields. 



Click for Larger Chart



Timing & trends

The 3 Most Popular Articles of the Week

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Posted by Money Talks Editor

on Saturday, 31 March 2018 06:34

politician grabbing money1. It's a Hideous Money Grab, Pure & Simple

    by Michael Campbell

Mike is hot under the collar about a new tax about to be levied on anyone who who owns a cottage, ski condo or family vacation home. The tax will have to be paid every year! They're calling it a speculation tax. 

 ....continue HERE

2. Bundesbank Warns German Banks Rates are Moving Higher

Martin Armstrong reports the latest movements on the interest rate front as well as the remarkable move by Germany which will convince the world the European project is authoritarian (Germany arrested a Catalonian politician enforcing Spain's dictatorship)

....read it all HERE

3. Ozzie Jurock's Latest Real Estate Recommendations

Ozzie's track record has been remarkable, Surrey BC up 60% last year, Seattle, Phoenix, Coquitlam, Burnaby....the list goes on but what he wants you to know is where to go now

...read more HERE


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