Investor Focused Market Analysis

The SP500 index (US Stock Market) continues to be in and Uptrend.

The major trend line on the chart below must be broken in a big way before a full blown bear market will be confirmed. This is still months away at best so do not worry. The AlgoTrades INNER-Market Analysis will get us positioned when the time is right and enable us to profit as the stock market falls in value.

Your long term equity investments can continue to be held at this point. Speculative and momentum stocks (Russell 2K index) continue to show weakness, so I would stay away from them. Large cap stocks will likely be in favor as the safe haven “blue chip” stocks, but when the market is ready to roll over, all stocks will fall. The safe haven plays should be bonds, gold, and inverse ETF funds.

We do fear a US dollar currency crisis, and if so investors will be moving away from US investments and the massive bond bubble may burst. But at this time, it is not a concern.

bigpicturemay

This chart I feel provides a great perspective on the overall market trend and price patterns. This is the 70 year prospective. I hope something like this unfolds. Fingers crossed to a 12 month correction/bear market. This will build the new base for the next super cycle.

US Dollar has now reached the upper resistance trend line… we could see weakness in the dollar going forward…

70yrmay

The Risk-Off Trade Is Slowly Unfolding

The S&P 500 index is losing its momentum. Money has been rotating into Bonds and global markets for a year in anticipation of the stock market correcting.

With six months of the SP500 index trading sideways we have had to focus on some other areas to find opportunities. Some recent winners have been long oil with UCO, long live cattle with COW, long Russia via RSX, and long Japan with EWJ. Those who follow my ETF trade alerts newsletter have avoided the recent chatter in the SP500. We have be doing even better with our active stock trades.

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Dan Jackson 6 years ago Member's comment

Excellent analysis, both near term and long term!

Chris Vermeulen 6 years ago Author's comment

Thank you Dan