Daily S&P 500 INDEX TRACKER

[kiora]

I love the 10th Man weekly post

http://www.mauldineconomics.com/conn...ket-strategies


He concludes - High valuations combined with shrinking profits are a dangerous cocktail that should scare the pants off anyone.

Take care

Yep winner ,it is all pass the parcel & keep the loo paper handy

[ananda77]

I wrote a reply yesterday, saying:

"am I going to be unhappy, now that the markets are giving way under the weight of over crowded trades?

No, this us the ONLY time accumulation makes sense ( even only in the short term for a start)

...and today, we all know why...

(don't know, why this post did not appear)

Kind Regards

[Hoop]

Winner...I respect John Mauldin..He rubs shoulders with the movers & shakers of the world and usually when he writes this stuff it usually echo's those peoples concerns...
I've been harping on lately about the dangers of forward earnings.. ....

You know which end of the Equity Market you're at when you analyse the results of past forecasts...At the beginning of the bull cycle the earnings are usually above forecasts and at the end of the bull market cycle the earnings are usually below forecasts...Nearly 7 years of bull market cycle have elapsed*** and are we seeing the signs of exuberant forecasting???...Crestmont Research figures show we are (see here for the Earnings trends: History & Future chart)...The insert box shows 24 months ago the S&P500 2015 forecast earnings were at $148 and the revised every 3 month figures since then those 2015 forecast earnings have been revalued downwards to be at forecast $98 now...That is inaccuracy at its best..eh?

So why is the S&P500 still hovering around its all time highs?....Inflation rate is the key driver..when the inflation is in its sweet spot of about 1% it can sustain an annualised PE Ratio of 20 to 23 % and that is where the S&P 500 is at the moment....also adding to this sustain ability is the continued exuberance that the 2016 forecast is projected to be at $120...so the market is optimistic that the S&P500 can go higher...

For the pessimists and some realists the problem is the height of the annualised PE ratio currently at 22-24% area...This is the figure where crashes start...but this crash has failed to materialise as the S&P500 has been in this 25 crash zone area for the last year or so now...Probably due to a lack of a trigger.. such as..no inflation rate movement..or no immediate problems or signs with the common 2 crash causing suspects, Banking or Property which have the ability to suddenly evaporate available money.....or ....the not yet realisation that the 2016 earnings forecast of $120 may not be achieved and therefore may get revised downwards,,which seems to be the forecast result trend at the mature end of bull market cycles***.

*** Disc: I personally believe the DOW and probably the S&P500 have been in Stage 1 Bear market cycle for 5 months now... Todays close up 2%

[ananda77]

Hi Hoop, if you think the US markets are in the first stage of a bear market, then there will be no new highs. The problem I have with this is the new high in the Nasdaq

Furthermore, none of the major US and European markets had their respective uptrends (weekly) challenged during the Thursday sell-off and Fridays sharp really up looks like a strong uptrend confirmation

Consequently, I think, the US markets are in their last stage of the nearly 7 year old bull market with at least one more high in front



Kind Regards

[ananda77]

..so far, so good, rescue ops successful - if markets not sold off last hour
...next stop: new highs

Kind Regards

[ananda77]

... closing markets right at support points? and not close to the day high or above?

institutional investors keep the large positive divergence, e.g: their selling versus central bank cash bazookas intact

all is wait and see for more - position accordingly -

Kind Regards

[JohnnyTheHorse]

Lots of technicals smashed. Futures currently sitting on the bull/bear trend line - this could be it folks

[Hoop]

Maybe this time, maybe not.... Johnny time will tell...If the S&P 500 is in a Bear market cycle then expect a few down waves to start appearing. The severe forms are termed capitulations...
At the moment
Europe is ugly today currently down -2.5 to -3.2%
China keeps shutting their shop (2nd time)..Hoping that will stop the slide.... -7% seems to be the circuit breaker point

S&P500 actions have been a lot milder but todays futures have more claws currently at -2.4%.....But they say "No Worries" there is a feel good economy going on and they have Aunty Yellen comforting them and its Election year..so everything is Hunky Dory..............however 3 lower lows and lower highs have occurred since beginning of November and now the 4th lower low is in progress...this action reinforces my belief that the DOW & S&P500 has probably been in a bear market cycle for 6 months now....This latest down wave is waking up some investors to question if the bull is still alive.

One of the very few Global Stockmarkets, still definitely in a Bull Market cycle is the Commodity dependent Country called New Zealand...go figure???

Ananda ..your thoughts now....

[winner69]

At this rate come next week S&P will be 1800 something

What happens then Hoop?

Bounce back to 2100 odd like it has done a few times in the past?

[winner69]

The 1900 mark held strong today

That's a good sign