Slope of Hope Blog Posts
Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.
Further to my post of June 8th, here’s what has happened, since then, on China’s Shanghai Index.
After making a slightly higher high of 5178.19 on June 11th, it has since plunged to a low today (July 8th) of 3421.53 to close at 3507.19…slightly above its 200 Day Moving Average — making a loss of 1671 points from high to close, thus far.
The first level of major supports sits around 3000…the next around 2500…a solid break and hold below 2000 could cause major panic in markets around the world.
So far, attempts by the Chinese Central Bank to intervene and stop this falling knife have failed…we’ll see if this market can find any stability at any of the above-noted levels. There are no “buy” signals at this time on the RSI, MACD, and Stochastics indicators — rather, they are still bearish, although quite oversold; however, the extreme bearish force of the MACD, in particular, should be respected, as we could, very well, see much more selling in the short term.
Here’s today’s swing-trading watch-list:
Long Adobe Systems (ADBE)
Going into 2016, the data points to a 9-11% increase in healthcare costs. Let’s not get bogged down into who will bear this cost, let’s just agree it will not be good for Employers, consumers, and State Budgets.
The GDP of the U.S. is approximately $17 trillion. Healthcare is 17% or approx $3 Trillion. This increase transfers $200 billion additional dollars out of consumers (as a tax, or employers as a cost, or States as an expenditure).
This is on top of an expected flat to 2% revenue growth expected next year. Consumers will stop spending on other things or take the tax and drop out, employers must grow $10 dollars of revenue for every dollar of the increase they will absorb, to simply keep EPS the same. At 8% of GDP for Employer portion of Health costs, that is $100 billion in new revenue. That is nearly a 6% growth in Revenue just to run in place.