Saturday, October 8, 2016
Will 2016 Parallel 2012?: Presidential Election and Bullish Market Season
Will 2016 Parallel 2012?: Presidential Election and Bullish Market Season: Presidential Election and Bullish Market Season Weekend GOP presidential Donald Trump's lewd remarks on Entertainment Tonight Hos...
Presidential Election and Bullish Market Season
Presidential Election and Bullish Market Season
Weekend GOP presidential Donald Trump's lewd remarks on Entertainment Tonight Host Nancy O'Dell in 2005 once again created another headlines for all media.Some GOPers even asked Mr. Trump to quit now.
Tomorrow will be the second presidential debate.Hillary Clinton won the first debate on September 26; Vice presidential debate winner went to GOP's Mike Pence over Democratic's Tim Kaine. In the first debate Mrs. Clinton obviously showed more politic intelligence and qualification than Mr. Trump. However in vice presidential debate, Mr. Kaine erroneously was impatient to interrupt Mr. Pence, creating a sense of Pence's higher level of debate.Historically, first debate has far more impact on final election results than the other two.
Based on Predictwise.Com's data, Mrs. Clinton winning odds increased to 87% from 69% before the first debate, efficiently stopping Mr.Trump's momentum. Like stock market, trend in motion tends to continue. If this is true, Mrs. Clinton will win in November 8 election.
Mrs. Clinton economic policy focuses on investment and growth while Mr. Trump wants to reform domestically and internationally.In USA too much reform doesn't seem to be passed easily when Congress has divisive views, which will create a gridlock that in turn will have less uncertainties for the market. This is why the market likes Mrs. Clinton so far.
Next week will start the third quarter earning and bullish season.October is the jinx month due to crashes in 1929 and 1987, the 554-point drop on October 27, 1997, back-to back massacres in 1978 and 1979, Friday the 13th in 1989, and meltdown in 2008. Also October is a bear killer and turned tide in 12 post-WWII bear markets: 1946, 1957, 1960, 1962, 1974, 1987, 1990, 1998, 2001, 2002, and 2011. These facts are quoted from Yale Hirsch's and Jeffrey Hirsch's stock Trader's Almanac, 2017== its 50th anniversary. Tip my hat to my friend Messrs. Hirsch.
So in the next four weeks market will not likely to drop too much, and will continue to engage time correction rather than magnitude correction.
Gunning Ju
market analyst
Flushing, New York
Saturday, September 17, 2016
Will 2016 Parallel 2012?: Rising Tech Index Imply Hilary Clinton Win and Fed...
Will 2016 Parallel 2012?: Rising Tech Index Imply Hilary Clinton Win and Fed...: Rising Tech Index Imply Hilary Clinton Win and Fed Next Move Recent market gyration disguises tech index strength. Over the past four week...
Rising Tech Index Imply Hilary Clinton Win and Fed's Next Move
Rising Tech Index Imply Hilary Clinton Win and Fed Next Move
Recent market gyration disguises tech index strength. Over the past four weeks, S&P 500 dropped 2.5% from its high, while Nasdaq Index down only 0.8%. Tech Index strength resulted from Apple, Alibaba, Amazon, Google, Facebook, Netease, Priceline, among others, each of which shows its uptrend intact.
In spite of tech stocks strength, many market players still think market will face tremendous challenge ahead. Below we continue our comparison between 2016 and 2012, two election years.
In 2012, S&P 500 had two corrections: One from March to June, S&P 500 corrected 11%, just 100 points below previous year high, after which S&P 500 entered 21.5% shallow short bear market mainly caused by European debt crisis; the other 8.9% correction happened between September to November with Hurricane Sandy and presidential elections as two uncertainties.
Back to 2016. In 2015 S&P 500 dropped 15.2% in 10 months caused by China's stock market collapse and the Fed's first move. Based on Ned Davis' bear market definition, this S&P 15.2% corrections was a bear market. In June 2016, S&P 500 dropped 6% due to Brexit fear. So what parallels can we draw from 2012 for the rest of the year?
Now the market similarly faces two uncertainties: the Fed fear and election.The Fed fear has been priced in the market for so long. Any real move and clear guidance for the next move will lift the veil, and market will melt up. As to election, most Silicon valley tech gurus endorsed Hilary Clinton, helping Nasdaq Tech Index continue to climb wall of fear.
So in 2012 after a 21.5% bear market in 2011, S&P 500 had two corrections: drop 11% between March to June, and down 8.9% from September to November 8 election;
In 2016, after a 15.2% bear market, S&P 500 had a 6% correction in June. How about market from September to November 8 election? In terms of above 2012 and 2016 similarities, my best guess is that S&P will drop 3-5%. Given that it has already down 2.4%, S&P 500 downside should be very limited. This optimistic view implies that the Fed will likely raise rates next week and say the the future move will be based on macro-data points.
So buying any dip will still be a good investment strategy this year.
Gunning Ju
From New York
Recent market gyration disguises tech index strength. Over the past four weeks, S&P 500 dropped 2.5% from its high, while Nasdaq Index down only 0.8%. Tech Index strength resulted from Apple, Alibaba, Amazon, Google, Facebook, Netease, Priceline, among others, each of which shows its uptrend intact.
In spite of tech stocks strength, many market players still think market will face tremendous challenge ahead. Below we continue our comparison between 2016 and 2012, two election years.
In 2012, S&P 500 had two corrections: One from March to June, S&P 500 corrected 11%, just 100 points below previous year high, after which S&P 500 entered 21.5% shallow short bear market mainly caused by European debt crisis; the other 8.9% correction happened between September to November with Hurricane Sandy and presidential elections as two uncertainties.
Back to 2016. In 2015 S&P 500 dropped 15.2% in 10 months caused by China's stock market collapse and the Fed's first move. Based on Ned Davis' bear market definition, this S&P 15.2% corrections was a bear market. In June 2016, S&P 500 dropped 6% due to Brexit fear. So what parallels can we draw from 2012 for the rest of the year?
Now the market similarly faces two uncertainties: the Fed fear and election.The Fed fear has been priced in the market for so long. Any real move and clear guidance for the next move will lift the veil, and market will melt up. As to election, most Silicon valley tech gurus endorsed Hilary Clinton, helping Nasdaq Tech Index continue to climb wall of fear.
So in 2012 after a 21.5% bear market in 2011, S&P 500 had two corrections: drop 11% between March to June, and down 8.9% from September to November 8 election;
In 2016, after a 15.2% bear market, S&P 500 had a 6% correction in June. How about market from September to November 8 election? In terms of above 2012 and 2016 similarities, my best guess is that S&P will drop 3-5%. Given that it has already down 2.4%, S&P 500 downside should be very limited. This optimistic view implies that the Fed will likely raise rates next week and say the the future move will be based on macro-data points.
So buying any dip will still be a good investment strategy this year.
Gunning Ju
From New York
Rising Tech Index Imply Hilary Clinton Win and Fed's Next Move
Rising Tech Index Imply Hilary Clinton Win and Fed Next Move
Recent market gyration disguises tech index strength. Over the past four weeks, S&P 500 dropped 2.5% from its high, while Nasdaq Index down only 0.8%. Tech Index strength resulted from Apple, Alibaba, Amazon, Google, Facebook, Netease, Priceline, among others, each of which shows its uptrend intact.
In spite of tech stocks strength, many market players still think market will face tremendous challenge ahead. Below we continue our comparison between 2016 and 2012, two election years.
In 2012, S&P 500 had two corrections: One from March to June, S&P 500 corrected 11%, just 100 points below previous year high, after which S&P 500 entered 21.5% shallow short bear market mainly caused by European debt crisis; the other 8.9% correction happened between September to November with Hurricane Sandy and presidential elections as two uncertainties.
Back to 2016. In 2015 S&P 500 dropped 15.2% in 10 months caused by China's stock market collapse and the Fed's first move. Based on Ned Davis' bear market definition, this S&P 15.2% corrections was a bear market. In June 2016, S&P 500 dropped 6% due to Brexit fear. So what parallels can we draw from 2012 for the rest of the year?
Now the market similarly faces two uncertainties: the Fed fear and election.The Fed fear has been priced in the market for so long. Any real move and clear guidance for the next move will lift the veil, and market will melt up before. As to election, most Silicon valley tech gurus endorsed Hilary Clinton, helping Nadaq Tech Index continue to climb wall of fear.
So in 2012 after a 21.5% bear market in 2011, S&P 500 had two corrections: drop 11% between March to June, and down 8.9% from September to November 8 election;
In 2016, after a 15.2% bear market, S&P 500 had a 6% correction in June. How about market from September to November 8 election? In terms of above 2012 and 2016 similarities, my best guess is that S&P will drop 3-5%. Given that it has already down 2.4%, S&P 500 downside should be very limited. This optimistic view implies that the Fed will likely raise rates next week and say the the future move will be based on macro-data points.
So buying any dip will still be a good investment strategy this year.
Gunning Ju
From New York
Recent market gyration disguises tech index strength. Over the past four weeks, S&P 500 dropped 2.5% from its high, while Nasdaq Index down only 0.8%. Tech Index strength resulted from Apple, Alibaba, Amazon, Google, Facebook, Netease, Priceline, among others, each of which shows its uptrend intact.
In spite of tech stocks strength, many market players still think market will face tremendous challenge ahead. Below we continue our comparison between 2016 and 2012, two election years.
In 2012, S&P 500 had two corrections: One from March to June, S&P 500 corrected 11%, just 100 points below previous year high, after which S&P 500 entered 21.5% shallow short bear market mainly caused by European debt crisis; the other 8.9% correction happened between September to November with Hurricane Sandy and presidential elections as two uncertainties.
Back to 2016. In 2015 S&P 500 dropped 15.2% in 10 months caused by China's stock market collapse and the Fed's first move. Based on Ned Davis' bear market definition, this S&P 15.2% corrections was a bear market. In June 2016, S&P 500 dropped 6% due to Brexit fear. So what parallels can we draw from 2012 for the rest of the year?
Now the market similarly faces two uncertainties: the Fed fear and election.The Fed fear has been priced in the market for so long. Any real move and clear guidance for the next move will lift the veil, and market will melt up before. As to election, most Silicon valley tech gurus endorsed Hilary Clinton, helping Nadaq Tech Index continue to climb wall of fear.
So in 2012 after a 21.5% bear market in 2011, S&P 500 had two corrections: drop 11% between March to June, and down 8.9% from September to November 8 election;
In 2016, after a 15.2% bear market, S&P 500 had a 6% correction in June. How about market from September to November 8 election? In terms of above 2012 and 2016 similarities, my best guess is that S&P will drop 3-5%. Given that it has already down 2.4%, S&P 500 downside should be very limited. This optimistic view implies that the Fed will likely raise rates next week and say the the future move will be based on macro-data points.
So buying any dip will still be a good investment strategy this year.
Gunning Ju
From New York
Saturday, August 6, 2016
Will 2016 Parallel 2012?: Markets as anticipated defy all the doubts heading...
Will 2016 Parallel 2012?: Markets as anticipated defy all the doubts heading...: Market Defies Bearish Views and Goes Its Own Way To Its Destiny Months ago famous billionaires George Soros, Bill Gross,Carl Icahn, Dru...
Markets as anticipated defy all the doubts heading to new high ground
Market Defies Bearish Views and Goes Its Own Way To Its Destiny
Back to six years ago when markets rallied nicely, Paul Tutor Jones made a comment via Bloomberg that he would not chase market , considering the macro-fundamental was not so strong that market rally would have further to go. Along the way until now, this second-longest bull market has surprises many market players and has been making us so suspicious on its legality and durability.But as long as there are so many doubters and /or perma bears around, this bull market will continue to climb the wall of worry.
So why have so many famous market players talked down market? Don't they really have no idea about what's going on? Of course not. To my views all those gentlemen have their own agenda. Lets say Jeff Gundlach, the young bond king, may have two agendas ( to educated guess) for why he is so bearish on equity market: a. being bearish on equity market, he may hope to have a bullish bond market;b. He endorses Donald Trump to be next president. Historically when markets performed poorly during election year, incumbent party would lose presidential election, 80% of the time.
Carl Icahn also belongs to second category. he publicly claimed that he would like to be Trump's Treasury if Trump is president.
Another bearish comments on equity markets may result from the fact that these market players want to take advantage of media to make up or add long positions....
This year gold and gold stocks have huge run. Jeff Gundlach was right at this aspect that the global central banks will continue to create ample liquidity and will not raise interest rate at faster paces.The previous three years' plunge with gold prices was overdone, and lot of gold stocks were priced in bankruptcy as the global equity markets did in 2009. So gold stocks revenged to run up immensely. But I think this run seems to be overdone and this gold bull rally is not the beginning of another leg of super gold bull market.
Weeks ago I found great Dow theorist Richard Russell passed way on November 23, 2015.We lost a truly great market theorist. I thought that I would interview him some time ago. His five decades' Dow letters of using Dow theory to interpret market will be a market treasure for us forever. Wish he Rests In Peace.
Gunning Ju
A market analyst
From Flushing, New York
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