US Companies are building plants in Mexico - they bypass the very expensive cargo ship transport and they own the plant site and equipment and intellectual property outright without having to put up with Communist Party thuggery.
What's Holding This Market Up?
- Thread starter Scataphagos
- Start date
US Companies are building plants in Mexico - they bypass the very expensive cargo ship transport and they own the plant site and equipment and intellectual property outright without having to put up with Communist Party thuggery.
Large "Triple Top"/equivalent possible in Dow, SP, and small caps (NYA is weaker). NASDAQ, even with the FANGs, is looking like a possible large double top. For the market to be bullish and march smartly ahead, the possible topping levels need to be broken and left behind.
Raising stops on longs here seems prudent.
Raising stops on longs here seems prudent.
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the big boys
they are sitting on tons of stock at lower levels but no one is buying from them....
so they will hold the market up and take it up and up until everyone buys...
if no one buys from them at 26000 dow it will go to 30000.
if still no one buys from them...you will see dow 40000.
they are sitting on tons of stock at lower levels but no one is buying from them....
so they will hold the market up and take it up and up until everyone buys...
if no one buys from them at 26000 dow it will go to 30000.
if still no one buys from them...you will see dow 40000.
Sharp rebound is a feature of the bear. Shorts cover in panic.
But that’s not the key feature. A real bear market needs overvalued assets with very crowded public participation. Neither is present at the moment
I posted earlier in this thread. Find me another asset class high quality like the sp500 and yielding 5.x%. You won’t find anything close
Household with stock market participation is low compare to historical average.
Checking account balance at all time high. Corporate cash at all time high.
Now you tell me what’s holding it up.
There got to be a bubble somewhere in China we are not aware yet.
Volume is thinning now.
PA
Volume is thinning now.
PA
To be honest I really don’t like this stuff. Nothing personal. Double top. Breaking out of resistance etc. Taking like this is like writing on the forehead ‘I am amateur’.
Saying double top happens before a drop is like saying walking forward you need to put one foot in front of the other.
What is the success rate of double top or head and shoulder? Don’t bother lol. It’s 50%. Which means they have nada value.
And there is no such thing as ‘resistance’. My pro boys decide when the market sells down in their secret meetings. Previous high means nothing. Only 1 guy in the world traded at that price.
Alas all this TA stuff is such garbage.
It's more useful to ask, "Why should the market be priced lower?"
Short term direction and pricing is determined by flows; longer term pricing is determined by portfolio balance effects. If the US equity market dropped 50% tomorrow then all of a sudden investor portfolios will be hugely overweight fixed income. That might make sense if T-bonds are yielding 6% while stocks are yielding 2% on collapsing forward earnings as the economy spirals into recession, or it's 2008, the financial system has frozen and Dow 30 companies all of a sudden can't make payroll. Nothing like that is the case today, hence the market bounced right back up after December's mini-panic.
Right now assets are expensive, but that doesn't mean they should or will go lower. The economy is chugging along more or less fine, as are earnings. Retail pikers can panic on Zerohedge headlines, sell everything and go to 100% cash or gold; pro-managed pension funds, FOs, endowments and the like have an investment horizon of decades and adhere to portfolio allocations which don't change quickly, or by very much. Meanwhile, the constant rise in the money supply combined with shrinking equity float sends the dollar value of each share up and up over time.
Short term direction and pricing is determined by flows; longer term pricing is determined by portfolio balance effects. If the US equity market dropped 50% tomorrow then all of a sudden investor portfolios will be hugely overweight fixed income. That might make sense if T-bonds are yielding 6% while stocks are yielding 2% on collapsing forward earnings as the economy spirals into recession, or it's 2008, the financial system has frozen and Dow 30 companies all of a sudden can't make payroll. Nothing like that is the case today, hence the market bounced right back up after December's mini-panic.
Right now assets are expensive, but that doesn't mean they should or will go lower. The economy is chugging along more or less fine, as are earnings. Retail pikers can panic on Zerohedge headlines, sell everything and go to 100% cash or gold; pro-managed pension funds, FOs, endowments and the like have an investment horizon of decades and adhere to portfolio allocations which don't change quickly, or by very much. Meanwhile, the constant rise in the money supply combined with shrinking equity float sends the dollar value of each share up and up over time.
no we know about the bubble lol... real estate value in the 4 biggest cities is higher than the entire USA.. that's why I said per a calculation on the napkin, the real exchange rate is about 1USD = 20RMB is free exchange is allowed to happen.
massive debt bubble, massive liquidity trap in China, real estate value thru the roof, literally.
but all that is contained, the RMB can not free flow....
by the way this is the key difference between a reserve currency like the USD and the one that is not, like the RMB.... imagine if RMB were the world reserve currency, all the stuff China printed... then whatever you saved in the bank would suffer like a 70% hair cut lol.
that's what the trade war is all about... world dominance, reserve currency.
volume - thinning is a GOOD thing!
https://stockmarketobservations.fil...chology-of-the-stock-market-by-g-c-selden.pdf
here is a free gift for you - it describes how a bull market is born, gets mature, and dies... and the death is caused by increased float, or bigger volume lol (conventional wisdom TA can go to hell on this one saying a rally needs big volume to be legit).
I hold lots of stuff long term and I actually watch average volume and I WANT the volume to be thin... because that means my pro boys have good chip control and they are still in the process of marking up the price... I'd start to get cautious when the volume start to get active, my boys float out a lot of shares for speculators to toss around, and household participation gets high... that when a bull is close to death!
Medium trend is still down.
If you think of TA as an unregulated ponzi scheme, it works until it doesn't work, then it crashes.
That's why TA works - to a fashion.