World Indices Roundup 2021

The Nasdaq has now closed below its 21 EMA. Notice how TSLA led the market lower.

Money seems to be rotating into value, commodities and re-opening plays. It is yet to be seen whether these can be the next sectors to lead the market higher.

If this is the start of a correction (and it may not be), nobody knows how far it will correct. However, all corrections setup up the next leg higher. Watch for stocks who show strength in the face of selling.

 

Maybe not for everyone ..


Waiting for the Last Dance

Quote..
Another more measurable feature of a late-stage bull, from the South Sea bubble to the Tech bubble of 1999, has been an acceleration3 of the final leg, which in recent cases has been over 60% in the last 21 months to the peak, a rate well over twice the normal rate of bull market ascents. This time, the U.S. indices have advanced from +69% for the S&P 500 to +100% for the Russell 2000 in just 9 months. Not bad! And there may still be more climbing to come. But it has already met this necessary test of a late-stage bubble

 

He is a perma-bear. Just something to keep in mind.

 

well i am actually an optimist , i just sound like a perma-bear , because i look for strong fundamentals right at the start ( and dig into the debt loading $3 mill. isn't a lot of debt unless you owe it to a loan predator who wants more than 15% a year in interest AND loan reduction payments .. say spread over 3 years )

.. and silver-linings are pretty damn rear in the current economic climate , underestimated national debt figures glossed up earning projections etc etc etc

 

Charlie Munger warns of market excesses, frowns on gambling mentality and bitcoin
Quote ..
Charlie Munger, the longtime business partner of Warren Buffett, on Wednesday suggested the stock market environment bears signs of a bubble, reflecting a “dangerous” mentality among some investors to gamble on stocks as they would horse races.

...

Munger said the recent surge in the share price of GameStop Corp, which left some hedge funds caught in a short squeeze because they bet on a decline, reflected a horse-racing mentality toward stocks.

“It’s really stupid to have a culture” encouraging such gambling in stocks, calling the frenzied buying of stocks only because prices are rising “a very dangerous way to invest.”

Asked if the market now might suffer the same fate as the technology bubble from the late 1990s, Munger said: “Yes, I think it must end badly, but I don’t know when.”

Munger also addressed other topics, including the surging interest in bitcoin, which he would not own.

I don’t think bitcoin is going to end up as the medium of exchange for the world” because it’s too volatile, Munger said.

Charlie Munger warns of market excesses, frowns on gambling mentality and bitcoin | Financial Post

 

Henry Ford is attributed with saying...
"If you think you can or you think you can't, you are right."

Perhaps a corollary might be...
"Whether you predict the market will rise or your predict it will fall, you are right."

 

Buffet & Munger have been anti Bitcoin for years, with buffet calling it rat poison squared.
They have been completely wrong on it, repeatedly.
Interesting to see Munger say it's too volatile, as I was expecting a much stronger rejection from them saying it's complete worthless digital garbage.

 

Its good to hear all perspectives and having an open mind.

But being right at the wrong time doesn’t count, unfortunately.

There is a very strong bull market going on at the moment, driven by stimulus. And like every major bull market before it value investors call it a bubble.

At some point the bull will end. And like every major top going back to when the market started, it will show signs in the days and weeks before it.

 

Maybe someone can convince me on bitcoin (or crypto in general)... because I only see it as an over-complicated, tulip-like bubble. Do I buy it as an investment? Store of value? I honestly don't know.

 

The only way I'm going to own crypto is if any of the companies in my VAS VTS or VEU ETFs buy them. So since I hear Tesla has already bought some bitcoin..WOOHOOO!

 

Who cares what WB or CB thinks or if Bitcoin is or is not an investment or whether the market will or will not go up or down (it usually does).

What is offensive is the tile of this thread is:

World Indices Roundup 2020

Big fail by the mods. Do better, OK?

 

Best plant food ever.

Back on topic.

 

From analysis of SPX during February my expectation was that a major decline would commence in late February, possibly around 24 February where a Fibonacci time relationship existed between two waves ( ((e)) = 1.618 x ((c)) ) of the larger pattern that I believe constitutes the rise off the March 2020 low. Weakness in SPX arrived earlier and commenced on 13 February. As the weakness has not been a dramatic and rapid decline I do not believe there has been a major change in trend. I expected that 4 and 5 March 2021 would be days of heightened volatility. 4000 is quite clearly upper resistance for SPX. The next period of interest I’m watching is the trading period around the upcoming equinox, so around 19-22 March 2021. This is close to 26 March when the duration of wave ((e)) would equal the duration of wave ((b)) + wave ((c)) + wave ((d)).

 

Overall NEoWave structure from the March 2020 low appears to be a complex correction of two NEoWave structures separated by wave ((x)). The NEoWave structure since 30 October 2020 has been rethought many times. My current thinking is that it is a diametric, a seven-wave structure. In a diametric the duration of two consecutive waves can be similar to the duration of each of the other waves comprising the diametric. For XJO, the combined duration of waves (d) and (e) is similar to the duration of waves (a), (b) and (c). Hence, there are only six of the large time boxes, not seven, shown on the chart. If a diametric is playing out wave (f) is underway and wave (g) will be the last wave. With a diametric a minimum of five waves will exhibit time similarity, albeit that one of these may technically be made up of two waves. So, either the duration of wave (f) or wave (g) or both (f) and (g) is expected to be similar to the duration of waves (a), (b) and (c).

 

How did the Fibonacci time relationship go during January and February 2020? Did it predict March?

 

I will assume you do indeed mean 2020 and not 2021 and your question refers to identifying the March 2020 low.

Analysts with an interest in time relationships/cycles would have been watching 30 days and 34 days post the February 2020 high for a potential turning point. 30 days comes from the work of WD Gann and 34 days is a Fibonacci number. The duration of the decline in SPX was 32 days.

The price low and high on 27 March 2020 being above the high of 20 March 2020 was also a technical clue pointing to a trend change to the upside (at least short-term i.e. weeks) having occurred.

 

Hi Kitdoctor,
thanks for sharing ... always a joy to find new posts from you & Alex
Just wanted to ask, from the posted chart, are we expecting XJO to be somewhere between 4430 & 4580 in July 2021 ?

 

@VanillaSlice negative to your question regards a possible target range for XJO. The dashed lines are just to show the forecast direction of future price action and that it is expected to be a significant decline. When I want to show a possible target range I will add the necessary detail required on the chart and would make comment