Stock Market Predictions 2019; Don’t Follow The Crowd

Stock Market Predictions 2019

Stock Market Predictions 2019

The main suggestion we would provide to novice investors is to never follow the crowd, for they are always on the wrong side of the fence.  This advice applies to 2019 and all the years before and after 2019.

Investors are sitting on a huge pile of cash and it is growing by the day.  The masses panicked when the so-called Santa Claus rally failed to materialize. What they failed to spot was that Santa was providing the astute player with a lovely shopping list and all the goods were on sale.   This January effect was one of the strongest on record and more than makes up for the Santa Claus fail; hence, if there is still time to jump in and buy. Mass Psychology clearly states that the best time to buy is when the masses are ignoring an investment or the stock market is crashing.

Stock Market Predictions  2019 (March)

The term forever QE has just started to come into play recently, and mainstream media is most likely going to embrace this term and weaponise it in not so distant future.  However, we first addressed this phenomenon back in in 2015 and here is the link that details what was said at that time

The outlook has only worsened since then; the new tax breaks corporations got will be used to purchase more shares, and the reason is simple, it pays more in the short term to boost profits by reducing share count than in investing in the company. Corporations will continue down this path until new laws are enacted and they will become more emboldened with time. Gone are the days where there was a semblance of caring for the investor; insiders are only concerned with how much they can make and they don’t care if they destroy the company in the process.  Extracted from March 31, 2019, Market Update 

Market Predictions  July 2019

Despite the Markets surging to new highs, bullish sentiment is not rising as much as one would expect it. However, this week, the anxiety gauge experienced one of its sharpest moves in a long while. It is just a tiny move from moving into the moderate zone; this is one of the most significant moves we have seen this year. This divergence between the anxiety indicator and the sentiment indicator (shown below) is quite substantial, and it could imply that over the short term, we should be prepared for more volatility.

Another interesting development is that for the most part of 2019, bullish sentiment has traded well below the historical average of 39. Now let this sink in, we are in one of the longest bull markets in history, and instead of soaring to the moon, bullish sentiment is trading well below its historical average. Contrast this to the sentiment in bitcoin; currently, the sentiment is close to the euphoric stage, and this latest Bull Run is only two months in the making.  Extracted From July 11, 2019 Market Update 

What is the common Theme During the Market Turmoil Phase

The world is ending and you need to flee for the hills. The media then diligently create a cocktail on steroids and serves it to the masses, like sheeple; they fall for the same line over and over again.

“Investors can penalize themselves. While money market funds offer safety, they come at a cost as they accept a lower yield,” said Jerome Schneider, head of short-term portfolio management at PIMCO in Newport Beach, California.

“I like cash now. You can earn a very reasonable return on cash,” said James Sarni, senior portfolio manager at Payden & Rygel in Los Angeles.

We stated all along that the Fed was lying about inflation and now the truth has emerged. Suddenly Powell is changing his tune, now he has pledged to be “patient” before raising rates; what gives? B.S that is what gives, the Fed’s only function is to foster boom and bust cycles.

“I worry those investors who have long-term horizons may be hurting themselves,” said Kristina Hooper, global market strategist at Invesco in New York.

Stock Market Predictions 2019; Uncertainty equates to opportunity

However, as always the masses will wait until the very end, then they will jump in and shortly after that the markets will tank. For the masses, the only possible outcome is pain, loss and misery.  Investors sitting on the sidelines are already paying the press, quality stocks have made a strong comeback from their Dec lows and the party has just begun.

PIMCO’s Schneider stated the following and we could not agree more

“They tend to play it safe for too long,”

Masses Panic over anything and everything

The mass mindset is not restricted to the average investor. Some of the biggest firms are lead by individuals that think like lemmings and we all know that lemmings serve only one purpose; cannon fodder.  To date institutions and individuals have poured billions upon billions of dollars into money market funds. As we stated the obvious culprits were; Interest rates, the trade war, government shutdown, Trump investigations and whatever other rubbish you can come up with.

Money market assets surged to $3 trillion this January, the highest level since March of 2010, clearly indicating that the masses as always know nothing and panic at precisely the right time. Well wrong time for them, but right for the big players.

Other stories of Interest

US Debt To GDP Means Nothing To Bonds & Stocks  (Feb 12)

Technology-Driven Deflation Will Kill The Inflation Monster (Feb 7)

Business Investment & Stock Market Uncertainty   (Jan 31)

Dow 30 Stocks; what are they saying about the markets  (Jan 30)

Stock Market Bull 2019; Follow The Trend & Avoid The Noise   (Jan 29)

Long Term Trends & Bull Market Bear Market Nonsense   (Jan 16)

Bull & Bear Market 2019: which one will prevail  (Jan 14)

Stock Market Crash-Media Lies And Ignorant Experts  (Jan 11)

Market Correction Vs A Back Breaking Market Correction (Jan 3)

Bitcoin Crash: Is Bitcoin Bull Dead Forever (Jan 1)