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.
The Fed gave us exactly what the market expected in a .25% rate cut, and even gave us a “gift” with the early cessation of Quantitative Tightening. Normally, most would view this as a bullish catalyst. However, with market sentiment topping out in a bullish extreme, market participants interpreted the Fed action as bearish (despite its positive substance), and the market sold off this past week.
Based upon my analysis, we now have a top in place, as I have been warning to expect. The question is what will that top represent?
With the market at all-time highs, we are now approaching another Fed meeting. But, this one will likely provide us with a change in direction for rates, if you believe what most pundits are saying. In fact, there seems to be 100% certainty that the Fed will lower rates. Imagine that . . . the Fed is going to lower rates when the market is at its all-time highs. When was the last time this happened?
While many view a rate cut as being akin to the Fed “blessing” this market rally, history tells us a different story. What is most interesting is that the last time the Fed changed direction in rates near all-time highs was in 2007. And, when the Fed began to lower rates in 2007, it was just before the major stock market melt-down.
While we were prepared for last week’s run in silver in our service on ElliottWaveTrader.net, many are only now suggesting to buy into the metals after missing the last 10%+ move up in silver. Yes, that is what happens so often in financial markets. Markets go higher and people want to buy more the higher it goes. Yet I was getting a lot of pushback when I was suggesting people use price levels below 15 to accumulate silver holdings.
What strikes me as odd is that in every other aspect of your life, you are in search of “the deal.” If you want to make any other type of purchase, you invest a lot of time in finding the best or lowest price you can find out there in the market. Yet, that is not what happens with most investors in the financial markets.
Many investors maintain beliefs about the stock market which often have them looking the wrong way at the market turns. In fact, I can no longer count how many comments I see about how the Fed is what directs our stock market action, and it just makes me scratch my head.
The main argument by Fed watchers is that the Fed’s easy money drives the stock market. Yet, the Fed’s balance sheet peaked at $4.52 trillion in January of 2015 and is down over 12% from that peak. Yet the stock market has added over 40% since the Fed’s balance sheet peaked. Remember how often we were told by the Fed watchers that a shrinking Fed balance sheet would lead to a stock market crash? Well, it certainly did, but not in the direction most expected.
Preface from Tim: in case it’s not screamingly obvious, I did not write the following post (the prediction that we’re going to at least 3200 on the S&P 500 will be your first hint). Still, I wanted to share Avi’s perspective:
There is an old adage in the market which says that “everyone is a genius in a bull market.” What that really means is that as long as you keep looking to the long side in a bull market, you will be seen as a genius.
But, remember, one of the main perquisites for maintaining “genius” status is that we must be in a “bull market.” So, how do you know when a bull market is coming to an end?
Some time has passed since I wrote a more lengthy article, but not nearly as long a time as this gruelling bear market in cryptos – now 12 months long, and counting. So, in this article I’d like to rewind the clock a bit.
When we first saw our bull market top in cryptos, I did not fully expect a long bear market such as we’ve seen. While the March breakdown confirmed in my mind that the $3000 to $4700 zone would be visited again, I did not think it would take this long.
Greetings everyone! There are several chartist websites, all
EW’ers, that I visit to help me in my trading. They are not always in agreement
but it does help me gauge where we are at, up or down and strength of move. Tim
made a proposal that we could go up until Jan. 7th until the Trade
talks. As I look at these different websites it is becoming apparent that the
next move might be down. Why?