Archive for the ‘Stock Market Analysis’ Category

Stock Market Charts—George’s Analysis this Week

By Monday, June 20, 2011
A month ago, I expressed my concerns with the S&P chart and thought stocks were set for additional weakness. My investment advice was to be careful and not to chase stocks. Even after the one-day surge last Tuesday, I thought it was largely due to an extreme oversold condition resulting from stocks closing lower in seven of eight sessions. In my view, the bias continues to be negative and, until there is a base formation, I sense that stocks may edge lower.

Stock Market Trend Intact—But Correction Risk Rising

By Friday, February 11, 2011
It’s always wonderful when the stock market is going up. The vast majority of equity investors are making money. But I always look at the stock market in terms of risk, not potential return. When you have a market that’s been going virtually straight up for the last six months, I view investment risk for new positions as very high. Investment returns on new positions only happen if the momentum .

Why Stocks Look Vulnerable

By Wednesday, April 29, 2009
More reality is creeping back into the stock market and the bear market rally looks vulnerable. With so much money sitting on the sidelines, a lot of institutional investors took the opportunity early this earnings season to nibble away at some long-term positions, as well as actually trade the market. There's no doubt that the stock market's been strong since achieving its new low in early March, but I think investors need to be very cautious right now. The news isn't good enough for any sustainable stock market rally.

Risk Management 101

By Wednesday, October 8, 2008
With the current bias to the downside, you need to have some risk management in place to avoid watching your trading capital disappear. This could be via mental or physical stop-loss orders. Or, if you want to avoid selling into a negative market, you could write call options on some of your stocks to generate some premium income and help reduce the average cost of a position. However, the uncertainties .

Consolidation Period Coming Soon

By Wednesday, October 8, 2008
Price stability has always been an important goal of Western central banks around the world. Only until very recently have most central banks been quite hawkish on inflation and rightly so. Now, however, the threat of inflation remains, but there is the added risk of asset deflation, which is very real. This means that central banks have room to cut interest rates without the worry of stoking inflation too much..

Not Wise to Join the Current Sell-Off

By Tuesday, October 7, 2008
Black Monday appeared again, as the DOW fell as much as 800 points but recovered, and closed down 370 points or 3.58% on the day, breaking below key psychological support at 10,000. Across the board, selling was panicked, as investors flocked to the exits, dumping stocks. The focus of the selling was technology and small-cap growth stocks, as worries about a global meltdown and recession drove the selling. The fact .

Stocks: Where Do They Go From Here?

By Tuesday, October 7, 2008
If there is one thing I have learned from years of investing and obsessing with stocks, it is that no investment goes up or down in a straight line. After days of going down, the stock market is entering a severely oversold condition, from which we can expect to see some bargain-hunting by the patient money sitting on the sidelines. As we all know, Warren Buffett has already started buying .

Gauging Failure to Bail Out Fallout

By Monday, October 6, 2008
Markets continue to maintain a negative bias, as stocks trade at multi-year lows, with 2008 potentially the worst showing since the bear market in 2000. We are awaiting a second vote on a revised $700-billion bailout program that will give the markets some confidence. However, we feel it will do very little for small guys, as it appears more to be helping out failing companies. Yet, in spite of this, .

Financial Reform Must Focus on Credit Availability

By Thursday, October 2, 2008
The people that I speak with who are really worried about the current state of things are those who are retired or are just about to retire. Even if you look at the most conservative of stocks that yield dividends, the vast majority of blue-chip stocks have been very hard-hit by the current bear market. Also, if you are relying on income from your investments, your options are becoming very .

One Way to Tell the Direction of the Economy

By Thursday, October 2, 2008
A key variable in the success of the economy will be the labor market going forward. As business slows, companies will cut production and send workers home. This will translate into lost wages and a decline in consumer spending that will ultimately impact the economy negatively. In the U.S., the labor market has been soft, as indicated by the monthly non-farm payroll data and rise in unemployment claims. In September, .
Sep. 4, 2015
Trailing 12-month EPS for Dow Jones companies (Most Recent Quarter) $1014.15
Trailing 12-month Price/earnings multiple (Most Recent Quarter)

17.44

Dow Jones Industrial Average Dividend Yield 2.62%
10-year U.S. Treasury Yield 2.19%

Immediate term outlook:
The bear market rally in stocks that started in March 2009, extended because of unprecedented central bank money printing, is coming to an end. Gold bullion is up $1,000 an ounce since we first recommended it in 2002 and we are still bullish on the physical metal.

Short-to-medium term outlook:
World economies are entering their slowest growth period since 2009. The Chinese economy grew last year at its slowest pace in 24 years. Japan is in recession. The eurozone is in depression. With almost half the S&P 500 companies deriving revenue outside the U.S., slower world economic growth will negatively impact revenue and earnings growth of American companies. Domestically, America’s gross domestic product grew by only a meager 2.3% in the second quarter, which will negatively impact an already overpriced equity market.

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From: Michael Lombardi, MBA
Subject: 200% Profit on the Ultimate "Fear Gauge" Play

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