Stock Markets: The History Chart Of The End Of The World ( With Presidential Cycles)

I’ve been posting exclusively for the last 2 months on the PM complex as I know that is most of our members main focus. Since the PM complex is now in consolidation mode I would like to take this time to show you the other bull market that has been taking place in the US stock markets. It is important for me personally to be on record as early as possible because it means nothing after the fact. The easiest trade to make is the one you do in hindsight, after the fact, as many like to say, I have seen that move coming a mile away, again after it’s already half over.

I got on record on June 22nd of this year when I made a small post on the Markets Update, that I do at the end of each day.

June 22nd post:

Before we look at today’s charts I would like to give you a short answer on why I’m taking on so many positions in the stock markets. The short answer, for now, is that I recently had an epiphany moment similar to the one I had on the US dollar back in 2014 when I discovered that a massive 11-year base that was a fractal to the one that formed previously that most of you have seen many times.

Currently, I’m seeing some patterns setting up in the stock markets that could lead to a very powerful rally the likes of what we’ve never seen before. I realize that many think I’m living in a fantasy land by being bullish on the stock markets which is fine because I don’t want to run with the herd. I want to go where no man has gone before. That sounds like a movie title.

The bottom line is that I need to see a little more price action which could happen fairly quickly over the next couple of weeks to come forward with what I think could happen. The kicker is that the PM stocks will go along for the ride. I’m posting this today so I’ll be on record if indeed what I’m seeing plays out. It will mean nothing after the fact.

So here we are 2 months later on August 23rd and what I was seeing back on June 22nd is still in play. The price action has been working out very well but the time component is lagging a bit taking a little longer than I had anticipated but nothing is broken yet.

To show you why I still remain bullish on the stock markets we’ll need to start with the long term charts first and then work our way back to the daily charts. If what you are seeing on the short term chart does’t match up with what the long term chart is suggesting then you can start to question the validity of the bull market in our case. For instance, if the long term chart is bullish and you see a reversal pattern, H&S or double top building out on a fairly large scale, then a big red flag goes up.

On the other hand, if the long term chart is showing bullish price action and you see an H&S or double bottom forming on the smaller timeframe then that helps confirm the big trend or bull market is still in tact.

We currently find ourselves in a very unique environment with 2 secular bull markets going on at the same time, the PM complex and the US stock markets. It gets even more bullish as commodities appear to have ended their multi-year bear market 4 months ago in April. In all my years of trading the markets, I can’t remember ever seeing so many bull markets simultaneously moving together at one time.

If one is to step back a little and looks at the state of our country right now how much gloomier can it get? The list is a mile long from the 2020 crash caused by the coronavirus, unemployment at record numbers, black lives matter demonstrations in the streets, you get the point? Looking at all this doom and gloom rationally then yes the world as we know it is coming to an end and there is nothing we can do about.

There is one axiom that stands out more than others which has to do with the stock markets and that is to BUY LOW AND SELL HIGH. Another one is to buy when there is blood in the streets which we literally had during the BLM protests. In early February most of the US stock markets were trading at new all-time highs with no bearish patterns in sight. Then out of nowhere, the stock markets experienced one of the deepest short term bear market in history which ended a month later in March.

Many of you will remember the stock markets had recently broken out of some very beautiful and symmetrical 2018 H&S consolidation patterns and the new impulse to the upside was in full swing again. There are some very rare events that can happen that no one can see until they happen which are called, an act of God or a black swan event.

What happened on 911 was such an event where only the terrorist knew what was about to take place. What the 2020 crash did was to put a speed bump in front of the existing secular bull market that began in 2009. More on this a bit later.

Before we get into the long term charts for the stock markets I would like to start with a 40-year chart for the COMPQ which I call, “The History Chart for the End of the World,” which is a satirical look at all the major events that felt like the end of the world when they took place but were actually great buying opportunities. Many of you will recognize some of these events if you are old enough. For the younger members, these major events felt like the end of the world if you were actually trading back then when they happened. For most of you, it will just be an abstract event with no real meaning. For those of you that haven’t traded during one of these, end of the world events, congratulations as you have just experienced your first one. Make sure you put this fairly rare event in your memory bank because you are going to see this again if you survive long enough trading the markets.

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