The Dow Rose Almost 700 Points on Monday. Why Am I Nervous?
Mar 30, 2018 | Investing Strategies
On Monday, the Dow Jones Industrial Average (DJIA) rose 670 points in a huge one-day rally. The news that the US and China were negotiating gave hope that there would be no trade war. News outlets hailed the move. The President even tweeted about it. The day’s huge gain made me nervous. Especially after having done this research. Nine out…
The Secret to Buffett’s Success
Mar 27, 2018 | Investing Strategies
The secret to Buffett’s success long-term is no secret to TradeStops subscribers. What does Buffett do? He doubles up on his winners! He buys more shares of a winning stock as it moves higher. Unfortunately, many investors do the exact opposite of what Buffett does – they double down on their losers – and then they wonder why they’re not…
If the Nasdaq-Dow Divergence Resolves Bearishly, Extreme Caution is Warranted
Mar 23, 2018 | Investing Strategies
In recent weeks, we analyzed signals from the Dow Jones Industrial Average and the Nasdaq 100 to assess overall market health. On March 6th we said our Dow-based indicators signaled more trouble ahead. But on March 13th we noted that technology looked better than the industrials. We pointed out that while the Dow was looking weak, the Nasdaq was not…
Buffett’s Lessons for Individual Investors
Mar 20, 2018 | Investing Strategies
Last year, we wrote about comments made by Warren Buffett that individual investors can have distinct advantages over large institutional investors. Here’s what Buffett said: “The highest rates of return I’ve ever achieved were in the 1950s… I think I could make you 50% a year on a million. No, I know I could… I guarantee that.” In this year’s…
If Treasury Bond Prices Surge Higher, Then Look Out Below (For Equities)
Mar 16, 2018 | Investing Strategies
Commitment of Traders (COT) data recently showed that speculators – a group that includes money managers and hedge funds – are record-level bearish on treasury bonds. This means a record-breaking number of treasury bond futures contracts were sold “short” in a bet that long-term bond prices would decline (and interest rates rise). Betting on rising long-term interest rates is a…
Technology Looking Better than Industrials
Mar 13, 2018 | Investing Strategies
Last week we ran our proprietary analysis on the Dow Jones Industrial Average (DJIA) and noted some serious red flags that could signal trouble ahead. The DJIA itself is in the Red Zone and more than 40% of the component stocks in the DJIA are also in the Red Zone. When both of these conditions were met in the past,…
Our “Smart Way to Play the Metals” Looks Even Smarter Today
Mar 09, 2018 | Investing Strategies
Wall Street has new reason to pour capital into metals and mining stocks – particularly US-based steel and aluminum producers. There are also multiple ways for US steel producers to benefit from what comes next – regardless of whether protectionist fears hurt other industries. The easiest way to gain exposure to US-based steel producers is through XME, the SPDR Metals…
Our Dow-Based Indicators are Signaling More Trouble Ahead
Mar 06, 2018 | Investing Strategies
As we all know, stock market volatility made a big comeback last month after a long absence. The February volatility surge had us waiving the caution flag while also emphasizing a “wait and see” approach. Indeed, the US stock market did come roaring back… but today we’re seeing more and more signs of internal market weakness… and more and more…
Wall Street Thinks T-Bond Prices Will Keep On Falling – We Disagree
Mar 02, 2018 | Investing Strategies
The bearishness in US Treasury bonds is palpable these days. T-Notes have been in a downtrend in recent weeks and are sitting near 3-year lows. Everyone seems to agree that the 30-year bull market in bonds (and bear market in bond yields) is over and that higher long-term interest rates are inevitable. I say – not so fast. We can…
What Sector Moves Did the Billionaires Make in Fourth Quarter 2017?
Feb 27, 2018 | Investing Strategies
We track the positions of sixteen billionaires to fuel our “beat the billionaires” strategy. As savvy market participants, this group of billionaires serves as an indicator of where the smart money is flowing. Today, we’ll look at their sector allocations and portfolio changes for fourth quarter 2017. The first thing we observe from the sector breakdown, shown below, is that…
