Every thing fell last week. Stock indexes, Bonds, Gold and Silver. The investor finally see that cash is the king and I think it will continue. Stock indexes are only for robots and short term trading. My advice for several months is to go short and stay short in all markets that I follow. The most important thing is that interest rates are rising since bonds fall and the cash is not going anywhere. Inflation in the US and Europe is now 0,7 and 0,3 percent and the trends are down - towards deflation. Few analysts see that so far but I think that will change. Deflation is very much worse to come to grips with than inflation and we have not had that problem for a very long time. Fed has 2 percent as a target and to get that spending is necessary but now money printing is soon going to slow. Employment is still too low and the long term trend is sideways to down.
The bond selling has probably only started and the last weeks acceleration through very strong resistance points for yield on upside and price on downside might soon come to a point where the very big bondholders all over the world start thinking of selling. Remember that interest rates have fallen from 1982 to 2012, 30 years and 10 year notes yield was at the bottom only months ago. The news are not out among every investor yet.
All main stock indexes have their daily trends down for a month and now the weekly trends for the leaders, FTSE and SWED look less likely to rise to a new all time high. I think the rising interest rates must top out before the US indexes will try upside again to eventually test the highs but the odds are shrinking.
My main forecast that a main bear market likely with start before the end of October is unchanged. Every trading day is now very important for my long term puzzle.
The bond selling has probably only started and the last weeks acceleration through very strong resistance points for yield on upside and price on downside might soon come to a point where the very big bondholders all over the world start thinking of selling. Remember that interest rates have fallen from 1982 to 2012, 30 years and 10 year notes yield was at the bottom only months ago. The news are not out among every investor yet.
All main stock indexes have their daily trends down for a month and now the weekly trends for the leaders, FTSE and SWED look less likely to rise to a new all time high. I think the rising interest rates must top out before the US indexes will try upside again to eventually test the highs but the odds are shrinking.
My main forecast that a main bear market likely with start before the end of October is unchanged. Every trading day is now very important for my long term puzzle.
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