Is “Risk On” Investor Focus On Equities In Jeopardy?

Monday, November 14, 2016

warning

The Establishment got it all wrong!  Will we ever experience free trade in America, again? It is the American people that can and will make America great, once again!  We cannot rely on the Federal government as we have seen their failure to deliver the American Dream to “Main Street Americans”, over years. One should be prepared for a wild ride, over the next few weeks to months, while the markets struggle with uncertain outcomes.

Global Central Bankers will continue to defy any rate hikes through the remainder of 2016 and throughout 2017.  Our financial system is extremely vulnerable to any interest rate increase. Can central banks manage this BUBBLE?  I believe the name of this game is called “kicking the can down the road” (even further). However, it is only a matter of time that we will be running out of road!

The cancer that we are currently fighting now is price deflation. This is the result of a fall in demand for goods and services (excluding anything related to the housing boom/building sector) which causes producers to reduce prices. This reduces their profits and causes a reduction in investment, which contributes to a further drop in demand. Within this deflationary spiral, deflation is often associated with recessions and depressions and has been known to cause extreme high unemployment. It is also called “negative inflation”.

The victory of President-Elect Donald J. Trump was due to a calling out for ‘change’ against the old established policies that continue to take us down the wrong road, which paved the path to this new and unexplored world of Trump’s vision.

President-Elect Trump made it clear that he believes the Fed is ineffective in setting interest rate policy. In addition, he questioned the basic function and value of having the Federal Reserve in its entirety. I see the likelihood of Dr. Yellen’s resignation on the horizon.  However, her term does not officially end until February 2018.

“Risk On”

There has been a dramatic shift in the US Markets!  US domestic stocks have outperformed the global markets.

The Russell 2000 came out of its’ oversold level with plenty of room to move on the upside and to go much higher. The Russell 2000 is one of the best indicators that forecasts the general trend of the stock market.

I expect the SPX to join the Dow Jones at an all-time high.

Investors are rotating into the financial sector and out of other sectors while they sort out what the future holds.  They are NOT selling stocks as experts predicted would occur after a Trump victory.  As this rotation occurs, the markets are in the process of “repricing” their assets.

Forget “Main Street Media” to guide you towards future financial success. I will provide you with the real “cutting edge” financial data and keep you on the right side of the markets.

As my cycle analysis and timing work has proven to be correct in the past, what is about to happen will be totally unexpected. 

In short the DXY (Dollar) is topping out and metals are completing a 5th and final wave down for a bounce this week at minimum as it tries to bottom before starting a rally higher.

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Chris Vermeulen has been involved in the markets since 1997 and is the founder of Technical Traders Ltd. He is an internationally recognized technical analyst, trader, and is the author of the book: 7 Steps to Win With Logic

Through years of research, trading and helping individual traders around the world. He learned that many traders have great trading ideas, but they lack one thing, they struggle to execute trades in a systematic way for consistent results. Chris helps educate traders with a three-hour video course that can change your trading results for the better.

His mission is to help his clients boost their trading performance while reducing market exposure and portfolio volatility.

He is a regular speaker on HoweStreet.com, and the FinancialSurvivorNetwork radio shows. Chris was also featured on the cover of AmalgaTrader Magazine, and contributes articles to several financial hubs like MoneyShow.com.