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mid term outlook for s&p 500 🌈🐻Technicals: - S&P500 broke a long term uptrend and now is seeing a rebound. a rebound was expected given the current level of volatility. I expect the price to get rejected at the long term uptrend line, but a throw-over is in the cards as it would be a perfect bull trap - support boxes are drawn out. these levels are likely contenders for a solid bottom since there should be many buyers interested at those prices. Fundamentals: - the exponential growth of the coronavirus in the US and worldwide leading to economic shutdowns - Saudi vs. Russia oil price war leading to the lowest prices in decades - huge debt burdens, high default risks - historically high valuations (even after the crash) according to Shiller p/e, total market cap to gdp, etc. - unemployment spike, literally highest in history (3.28 million in one week in the US, ~1 mill in Canada) and expected to worse - desperate central banks running out of levers for controlling the economy (interest rates at 0%, currency at risk of devaluation or loss of reserve status if QE is taken too far) - political uncertainty regarding 2020 elections, lack of good candidates, high probability of tax hikes - very similar environment as 1929 before the great depression, end of the long term debt cycle, interest rates hitting 0% Sentiment: - worldwide panic lead by fearmongering media outlets - overall bearish attitudes towards the markets leading to a lack of liquidity - once we break previous lows near $220 on SPY, expect a lot of panic selling My Approach: - dollar-cost-averaging into index funds diversified internationally, still 85% cash currently - higher than usual weight into REITs and emerging markets, US equities still have low expected returns at current valuations - expecting this bear market to last at least 6-12 months, possibly multiple years, no need to FOMO and spend all cash quickly - lots of opportunities for individual stock picking, ETFs are dumping holdings systematically based on the market cap without regard for fundamentals TL;DR: the economy is a shit show & the crash is just getting started
TVC:SPXShort
by delusional
Corona isn’t the only virus destroying the U.S economyOne of America’s greatest bull markets ended earlier this month. From the depths of the Great Recessions, the S&P 500 roared, generating ~400% over the last decade before falling victim to the coronavirus. However, corona isn’t the only virus eating away at the U.S economy. A deeper look at the stock market’s rise shows the symptoms have been apparent. America’s largest corporations have built a reputation for capital destruction. If a vaccine isn’t developed, the U.S. economy and our capitalistic system will remain quarantined long after coronavirus is contained. According to Informa Financial Intelligence, a total of $444 billion has been pulled out of the U.S. equity markets over the last decade. Some of you may be asking how the stock market could go up 400% over the last decade if investors pulled nearly half a trillion dollars. The biggest purchaser of stocks over the last decade has been U.S corporations. In total, S&P 500 companies have spent $4.3 trillion on stock buybacks and $3.3 billion on dividends since 2009- 91% of net income. S&P companies spent $600 billion on buybacks in 2017. In 2018, following the Tax Cuts and Jobs Act of 2017, companies in the S&P 500 Index spent 68% of net income ($806 billion) on stock buybacks. According to JP Morgan, the proportion of buybacks funded by corporate bonds reached 30% in both 2016 and 2017. With executives focused on short-term stock price fluctuations, research and development (R&D) have been severely neglected. In 2018, only 43% of companies in the S&P 500 companies recorded R&D expenses. Furthermore, 8% of companies accounted for more than 75% of total R&D spending. One of the main reasons stocks are falling is because corporations no longer have the funds to prop up the market. In addition, studies show that a majority of stock buybacks take place when the stock market is rising not falling. As a result, a majority of companies overpay for their stock- another form of capital destruction. Famed investor Warren Buffet once said, “Only when the tide goes out do you discover who's been swimming naked.” America’s largest companies got caught with their pants off, again. As long as the U.S. government and the Federal Reserve allow unhealthy companies (the virus) to live, the U.S. economy will never be healthy. -Appo Agbamu, CFA
AMEX:SPY
by AhrvoStockApp
1
BEARS may have come out of HIBERNATION !Really not being too helpful with this pair to go against the trend because USD is still a safe haven in times of geopolitical stress. Fundamental Reasons for having the SHORT BIAS EUROPE: 1. Eurozone GDP growth rate has been contracted to 1.1 percent from 4% while US GDP growth has rate has increased to 2.3% from 2.1% 2. German PMI has shown some signs of improvement but it would be too early to call the change in sentiment because apart from economic numbers, EUROZONE is still prone to geopolitical news like TRADE WAR which is still a matter to consider. 3. US ISM numbers were too good and it peaked above 50 after nearly 6 months. So, it can be anticipated that better numbers can come ahead. Hence, we can still load up dollars here and that's why we have also seen long USD positions building up via CFTC data. 4. Interest rate differentials between FED and ECB will still prefer USD buying from the carry trade perspective and cheaper Euro is considered to be a funding currency in times of equity correction. 5. Apart from Interest rate differentials, better economic numbers will also give a lift to US GDP and Inflation that can give FED a reason to lever up tightening in the coming months. Only considering a few major economic data from a fundamental point of view. Technical Reasons 1. EU is forming a clear bear flag with a perfect measurement of AB = CD where the current bear leg has a possibility to close the gap that was created post-Frech Presidential Election in April 2017. 2. Also, the volume has peaked which also indicates a short position has been built. Hence, a short from the pullback of this trend would reap a good reward than trying to catch the bottom.
Short
by RyanVarghese
Bitcoin future is promising, even in a downturn. Sure, we are in a downturn, a bear market; so what? With a long term line of sight, it's easy to see where Bitcoin is going. Every country has laws that govern. Heavyweights like the United States and China impact global markets. Considering Bitcoin has the attention of the two largest economies in the world, it's understandable that the market is affected. Take the blinders off and look at the long term environment for Bitcoin. I will share what I see. Path one: Bitcoin in the next year establishes confidence with the support of the United States regulatory environment. China and the United States make a long term trade deal and Bitcoin is open for business between the two countries as a valid means for transacting wealth. China's digital yen is utilized for global stock exchanges and the United States citizens will use Bitcoin as a vehicle between the two currencies (US Dollar <> Bitcoin <> Yen). Heres why. The dollar is losing foothold as a controlling global currency. With the digital yen hitting the global markets, the rest of the world gains immediate access to new financial tools based on the yen. The United States can use Bitcoin to compete as the transition to a digital dollar occurs. The United States will play a wait-and-see approach to a digital dollar, and they might just use Bitcoin as the vehicle to explore its options. If this path plays out, the value of Bitcoin will explode. For instance, fast track adoption in various stock exchanges across the world. Digital assets of various types will grow and allow cross-chain functionality with Bitcoin blockchain. Debt for countries will reduce due to new asset class creating a means for governments to secure new wealth for their fiat systems. Path two: Bitcoin continues to have issues with unfair policies set by various countries (especially, the United States and China). As regulations are muddy, Bitcoin continues to see extream two-way volatility. It will be emotional with up and down movement that causes whiplash. Fortunately, it can't last forever. The trend will change and governments will adopt friendly policies to please global fintech demand. Once the dust settles and regulations have a clear path for working with Bitcoin technology, we will see a continuation with the global trend in Bitcoin wealth generation. Path three: Bitcoin is outlawed in China due to an anti-competition stance with the digital yen. The United States continues to attempt a trade deal and faces central banking issues with the digital yen and de-dollarization of China. The United States desires to compete and opens all markets to access the US Dollar using Bitcoin in various market verticals like ETF and so forth. Matter of fact, this might be one reason for such delays to move this direction. If this occurs, the United States will adopt an open FinTech market to the global community to combat China and its de-dollarization with the digital yen. Bitcoin will explode and be used as a means to reduce the United States deficit. We might get close to a world war with China if this occurs, so it's not a great path to see come to fruition. Path four: Bitcoin is outlawed by China and the United States. Allies of these countries will adopt the trend. Global markets suffer, riots break out, and the fight for privacy becomes a global issue. A global depression occurs that has never been seen before. Due to global communication Bitcoin rises from its ashes and creates a new global economy. If this happens, the Bitcoin value will go near zero and explode to incredible valuation. Path five: Bitcoin is outlawed by all governments. The network becomes weak and is taken over due to a lack of contribution to maturing its codebase. It's an all-out digital mess and becomes worthless. This path seems the least likely to occur. In the end, most paths you can imagine lead to Bitcoin gaining new wealth generation abilities with services being adopted to complement regulatory environments. The long term outlook seems favorable for the technology. For this reason, I love blockchain technologies and will continue to build the skillset to compete in future economic environments in tech. If it does not work out, oh well, it's been a wonderful ride. I will have stories to tell for generations to come :) If you read this far, share your outlook. What is your thoughts regarding the potential paths for Bitcoin?
BNC:BLXLong
by brandycamacho
USDCAD Market Structure ExhaustionThe USDCAD is displaying 2/3 market structure. There are only 3 ways markets move: uptrend, range and downtrend. These are composed of swings in the case of uptrend and downtrends. The USDCAD has been in an uptrend, composed of higher lows and higher highs. We then began to exhaust as no new higher lows and higher highs were created. We are now in a range. Price exhausted near a resistance/flip zone of 1.3340, however I would prefer to see price test a bit closer. This would be one downfall for this idea. But the market structure is there. We are creating an exhaustion/topping pattern. With a break of 1.3260, we would break below a flip zone. This is what I am watching for. There is a demand zone at 1.3100 that should be a take profit zone. We do have the Bank of Canada this week on Wednesday. Many are expecting Canada to hold interest rates steady at 1.75% but Canada is not immune to the global slowdown. They will eventually cut rates. I must say that perhaps we could get a surprise cut. The rest of the world is cutting rates, and Canada is equal to the US in terms of rates. I do expect a dovish tone, which could see USDCAD test the aforementioned 1.3340 flip zone. Again, we will not be doing anything until the flip zone is broken which would give us the trigger to enter. Until then we remain on the sidelines.
by Uncharted-FX
Why Bitcoin Will Be Better Than GoldHello Everyone!!! I am Donald David Dongalore! Earlier in the day, I had promised that I would provide some remedial education! I am doing this because I believe that there is a lack of literacy, with regard to the cryptocurrency space, in the arena of monetary policy and the effect that meddling with a money supply can have! To fully understand what is happening, it is imperitive to have a firm understanding of what is so called "hard money" vs "easy money"! In the chart you can see that as far back as time will allow me to chart is the year of our LordAnneTaylor 1975. Unfortunately this does not allow for the accurate price analysis of Gold in comparison to the United States Dollar prior to thier decoupling by the great and glorious President Richard Nixon, who I'm told has established quite a reputation for watches and sunglasses! How exciting! The interesting item that I believe I have uncovered here is that when you scale the 21st Century Fox (TM) digital gold i.e. BTC to the origin of decoupling "hard money", we can see that what was once an asset which had appeared to be manipulated through paper (XAU) has done nothing more but grow in value on a consistent basis when compared to the now "easy money" generated by what can be presumed to be the "easy money" powerhouse of the world! It is interesting to note that this powerhouse of "easy money" no longer enjoys the same prosperity that it once had while following the economics of "hard money" and has since laden its populace with reckless amounts of debt! How enjoyable it must be to live there! BTC which is growing ever more scarce and difficult to obtain, shares many properties with XAU but has many more features which make it incredibly useful! Don't invest in "easy money"! It will make you poor! I don't give advice, but if I did, it would be good.
FRED:WM1NS
by UnknownUnicorn5810063
4
Bitcoin's Real SupportHello Everyone! I am Donald David Dongalore! This idea is less of a trade and more of a thesis about BTC! As you can see here, there seems to be a heavy interest in continually increasing the M2 money supply, and by extension...all other money supplies! The best part about BTC, is that it is finite! Meaning, that the more money that the Federal Reserve and U.S. Treasury make, the more valuable your BTC will be! Hooray for hard money! This is not financial advice, but it probably could be. But its not. Yahooooooooo!
FRED:WM2NS
by UnknownUnicorn5810063
2
S&P 500 - A Bearish Outlook Heading Into 2020Here is my thought process behind why I have a bearish outlook heading into 2020 - please note that this is the second time that I have ever published analysis and this is just me synthesizing a bunch of ideas. I'm going to start off with the lighter ideas before moving on to the heavier ideas... 1) We are in the late stage of the economic cycle... this is the longest expansion of the US economy since records began. Common sense dictates that we will enter a recession soon. 2) Keeping this in mind, let's look at the state of politics around the world. We have protests and riots in HK (recently a protestor was shot for the first time), we have Brexit which has both Germany and the UK on the brink of recession. The US and China trade war has not improved at all and is constantly seeing tit-for-tats. Finally, literally the other day the US was given the go-ahead by the WTO for $7.5 billion in tariffs on the EU in response to their 15-year long row over the subsidizing of the rival aircraft companies Boeing and Airbus. 3) In recent surveys, over half of economists in the US believe that a recession will hit the US in 2020. The market has also seen the yield curve invert, providing a stark warning (although this usually takes at least 12 months to materialize, this is a bad indicator). 4) There is a ridiculous bearish RSI divergence on the charts, with Fibonacci Time Zones pointing towards significant price action at the start or end of 2020. I believe this is because this cycle was pumped and overrated, running on the crack cocaine of financial markets: Quantitative Easing. 5) Recessions usually occur when there is a sharp fall in liquidity in the cash markets (referring to bank deposits and not trade execution liquidity). In recent times we have seen a bipartisan deal passed through in the US which mandated the US Treasury to "aggressively build up" cash reserves. After lowering the debt ceiling the Treasury plans on borrowing an additional $433 billion during this quarter (about $275 billion more than it had previously estimated) which is roughly ten times (1,000%) more than what the Treasury borrowed last quarter ($40 billion). This would cause global dollar liquidity to dry up fast (foreign nations and banks use excess deposits and reserves to purchase these meaning dollars flow out of the economy into the Treasury). 6) Continuing on from the last point, not only do we have dollar liquidity vanishing in the global economy but we have negative dollar swap spread (those lending USD via currency swaps want higher premiums). This is only getting deeper and deeper. Interestingly, the Bank of International Settlements found that cross-currency swap spreads act as a more accurate measure of struggle in the financial markets than the VIX. This shortage of dollars (highlighted by the premium being charged to lend dollars in swaps) comes at a time when the global economy is already weakening thus is making financial markets more fragile (turning to IMF reports on muted inflation and weaker final demand for goods and services) also referring to previous points Seeing and analyzing all these factors, the future doesn't look too bright. Disappointing economic data continues to plague our minds. As the Fed continues to cut interest rates they are only giving debt-laden companies one more sigh of relief which will only knock the inevitable crash further down the road when neither corporations nor the government can cope with it (they're throwing away all their ammunition and shooting themselves before the battle has even started). The drop to come will be harder and more brutal than 2008 because asset prices are currently inflated at incomprehensible levels due to quantitative easing as well as the Fed having little headroom to cut rates further. You could only imagine what is to come in countries with much less head-room for monetary policy than the US... What's next? Helicopter money!? Disclosure: I hold shares in: XSPS IGLT O IBTM
TVC:SPXShort
by malhardasgupta85
The Next Recession is probably within 2 years.The “Recession Watch” indicator tracks 7 key economic metrics which have historically preceded US recessions. It provides a real-time indication of incoming recession risk. While not flawless, this indicator gives a good picture of when risk is increasing, and therefore when you might want to start taking some money out of risky assets. All of the last seven recessions were preceded by a risk score of 3 or higher. Six of them were preceded by a risk score of 4 or higher. Based on the indicator hit rate at successfully flagging recessions over the last 50 years, risk scores have the following approximate probabilities of recession: - 0-1: Low - 2: 25% within next 18 months - 3: 30% within next 12 months - 4-7: 50% within next 12 months Note that a score of 3 is not necessarily a cause for panic. After all, there are substantial rewards to be had in the lead up to recessions (averaging 19% following yield curve inversion). For the brave, staying invested until the score jumps to 4+, or until the S&P500 drops below the 200day MA, will likely yield the best returns. Read more about the metric on Medium here: medium.com TradingView Indicator here: Notes on use: - use MONTHLY time period only (the economic metrics are reported monthly) - If you want to view the risk Score (1-7) you need to set your chart axis to "Logarithmic" Enjoy and good luck!
SP:SPX
by capriole_charles
1
Market is gripped with fearSince last Friday, the global market has been unable to recover from the sell-off after the fear of trade war has resurfaced. The reason for lack of meaningful bounce back is because Wall street and investors no longer believe in the magic of Trump Put after hearing from China denying they have called Trump. It is becoming evident to the US and global investors; Trump does not want to make a deal until next year because he knows any agreement can be scrutinized and fall apart and he would lose his chance of taking a big win to support his reelection campaign.
OANDA:SPX500USDShort
by stockmarketupdate
Recession Watch: PCE growthHere is a chart of quarterly PCE growth, which gives another useful 'recession watch' indicator. It is currently at a critical level and worth keeping a close eye on. Commentary from "The Recession Playbook" from Morgan Stanley: "With growth in real personal consumption expenditures (PCE) below 2.5% sending a reasonably consistent recession signal. Each of the last 5 recessions has seen real PCE actually shrink on a y/y basis by the end of the recession, but leading into the recessions a large decline in the growth of PCE is also very consistent. Given the heavy reliance of the US economy on the domestic consumer, slowing consumer spend is perhaps an obvious precondition for any recession." The chart data is from the Federal Reserve Economic Data site (FRED). fred.stlouisfed.org It can be studied in Tradingview using the ticker: 'QUANDL:FRED/DPCERO1Q156NBEA'
TVC:US10Y
by dime
3
Second TP @1,320 for GOLD Good Morning, Over a week ago, I posted a long position on Gold @,1275, showing a nine month trend and decided to take the risk. Half positions were to be closed @1,300 which occurred on Friday, May 31st 2019. Here is an update on where to close the remaining positions. In this chart, the Fib. retracement of 78.60% and the wave movement of the flag pole both indicate a target @ 1,320 and I shall be satisfied with all my profits. Never be greedy!
FX:XAUUSDLong
by Nixxflixx
ZIRP-unintended consequences--fisher international effectbased on interest rates and the importance of the euro and USD for global trade. we're seeing an irrational shift thats artificially effecting equity volatility. ZIRP or zero interest rate policy in euro zone. is driving demand for USD and us treasuries vs eurozone risk off assets. this flow is exploiting an already dramatic difference in interest rates globally. when bonds rally equities tend to fall. the bund last week hit an all time low of -20% yield on the german 10 year. aint that crazy people are dumb enough to buy an asset that has a 20% premium attached. thats right people are so afraid theyre willing to buy something and receive 20% less afterwards.. that being said people are choosing to go to US risk off USD and treasuries instead where they actually have a chance of making money. that transition is causing volatility. equity volatility is non-exsistant, but bond flows are overpowering flows.. INVESTORS MUST REMEMBER THE DISCOUNTING MECHANISM FOR FUTURE VALUE AND GROWTH IS.. THE RISK FREE RATE (US 10 YEAR YIELD) if the risk free rate is falling like a rock.. what is that saying about risk in US assets vs the world? thats exactly why im beyond bullish
TShort
by The_dumpster_diver