Market Uptrend Stalls; Timing a Choppy Market --Investment Thread for May 3, 2015

Weekly investment & finance thread ^ | May 3, 2015 | Freeper Investors

[expat_panama]

This past year's choppy indecisive unstable investment market continues as last Friday's IBD down grades our week-old uptrend back to "market under pressure".  Last week's rosy close turned sour for both the S&P500 and the NASDAQ as the major indexes immediately began a week of declines only to turn back up after the outlook was downgraded.  Precious metals weren't immune to the chaos either as they too stammered and fell back toward bases reached last Oct.

That's been pretty much the story of the past half-year with market uncertainty taking over.  The irony is that it's actually been a pretty good six months, just hard to get a handle on.  Those who've been in "buy and hold" mode have done pretty good, watching their stocks grow by a tenth and their metals hanging on.  The problem's been with the age old maxim "don't fight the tape" AKA "the trend is your friend".  While it's true that a rising tide lifts boats up equally, it's also true that there's no tide table to look up as for when the next market price surge is expected to happen.  That means all trend-followers can do is jump in after the wave.

So this points us to the idea of contrary investing where we buy when everyone says sell and vice-versa.   What we got is that if we buy every time the IBD market outlook is downgraded and sell on the up grades then these past 6 months see us picking up over 12.4% and 12.9% on the S&P500 and NASDAQ respectively.  That's even better than the 6.3% and 11.1% for the buy and hold method.  Blindly following the trend finishes in last place with meager gains --at least for how the market's been doing since last October.

That's just it though, nobody's  going to guarantee that Nov. 1, 2015 will find us having seen an identical repeat of what we've just had.  It don't work that way.  So while everyone here likes to say we're contrary, the trick is we got admit just what we're being contrary to.  I mean, are we going to buck the trend and ignore the huge mob of contrarians?

Kind of like that true non-conformist of the '60's who got a haircut.

 

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This is the thread where folks swap ideas on savings and investment ---here's a list of popular investing links that freepers have posted here and tomorrow morning we'll go on with our--

Open invitation continues always for idea-input for the thread, this being a joint effort works well.   Keywords: financial, WallStreet, stockmarket, economy.

[expat_panama]

Who Whom do you trust ping.

[11th_VA]

I’ve pretty much given up on the market myself. Started “trading” highly leveraged Russian Oil ETFs this year. Done pretty well as I’m up 15% YTD.

[expat_panama]

highly leveraged Russian Oil ETFs

huh, was noting how IBD's video has been begining with ads for Russian stocks.  Now there's a move for someone thinking outside the crowd.   Reminds me of how the Magellan fund manager used to look for out of favor or ignored stocks.  He did really well with undertakers that had gone public.

[Diana in Wisconsin]

Buy Blue Chip Stocks and hold them. Buy physical PMs and hold them. Live BELOW your means, no matter what said means happen to be at any given time. Turn every extra dollar into an asset, i.e. Buy Land!

And for The Love Of Pete; find a way to hide EVERY pre-tax dollar from Mother Government! (401K, IRA, Flex Medical funds, regular employer-based medical plans, etc.)

My advice is free. However, few can afford the rest of me. ;)

[expat_panama]

...Live BELOW your means...

That especially goes for housing.  Too many people try and save a few pennies turning in aluminum cans and then blow it all by spending and extra $10k/year on a fancier home.

[abb]

That especially goes for housing. Too many people try and save a few pennies turning in aluminum cans and then blow it all by spending and extra $10k/year on a fancier home.

I call it the SWIG Factor, for "See What I Got?". The SWIG factor has sold more houses and vehicles than everything else put together. It's similar to "Keeping up with the Jones'."

[expat_panama]

Right. A good salesman knows that most people decide things on an emotional level in the first minute of the sales pitch and after that all the talking is only for supplying "logic" to support a mind that's already made up. Which is why I try to make up my mind in private and then talk to the salesman to confirm the facts.

[Lurkina.n.Learnin]

Plenty of contrarians right here on FreeRepublic. Been telling me I’m crazy to have money in the market last six years or so while the markets have come close to tripling. Glad I didn’t listen.

[expat_panama]

A lovely morning to you --futures: Metals +0.32%, Indexes +0.23%!  No economic  reports to speak of today and the news is upbeat:

• European Stocks Advance on Robust Manufacturing Data   Wall Street Journal
• China Shares Recover From Early Losses Wall Street Journal - 9 hours ago China shares closed higher Monday, recovering from an early fall after a reading of the country's manufacturing activity slowed more sharply than initially expected, a further sign the economy is flagging.
• Oil hits 2015 high as traders look beyond ample current supply
• Greece aims for deal with lenders, IMF hard on reforms: minister Greece intends to meet debt payments this month and reach a deal with its international lenders to unlock remaining bailout aid, but the International Monetary Fund insists on tough labor reforms, the country's labor minister said on Monday...
• More Americans spending at least half their pay on housing
• 'Naked' Short Selling Serves a Valuable Purpose - John Aidan Byrne, NYP

[expat_panama]

Their loss, but it seems there’s a growing war on stockholders, corporations, and business in general —kind of a social suicide. After all the notorious failures of state run economies the U.S. still seems to be dominated by left-wingers that want us to be more like well, Cuba. Last night I was watching a action/crime TV show (The Blacklist) where the terrorist badguy was at war w/ “WallStreet” and one of our friends at the CIA made a crack on how much he sympathized w/ him.

[abb]

Got a kind of contrary indicator this morning. A couple of the loafers at coffee this morning - both gov’t retireds who know less than nothing about wealth creation and business - mumbled something about getting into the market.

[expat_panama]

hmmm

There's an old story (may even be true) of how JP Morgan was getting his shoes shined and the shiner was rambling on and on all about what stocks he owned and was buying and right after Morgan realized that if the market was that saturated that there could not possibly be any more demand available --so Morgan shut down his holdings. This supposedly happened in the beginning of '29.

[abb]

I heard it was Papa Joe Kennedy, instead of Morgan.

http://archive.fortune.com/magazines/fortune/fortune_archive/1996/04/15/211503/index.htm

WHEN THE SHOESHINE BOYS TALK STOCKS IT WAS A GREAT SELL SIGNAL IN 1929. SO WHAT ARE THE SHOESHINE BOYS TALKING ABOUT NOW?
(FORTUNE Magazine)
By JOHN ROTHCHILD
April 15, 1996

[expat_panama]

Had to be, just checked and JP Morgan died in 1913.

[expat_panama]

Hey there, we're rich!  At least richer than we were yesterday --stock indexes rose in weak trade with the S&P up 0.3% and and the NASDAQ +0.2%, and metals recovered a bit with gold up to $1,188 and silver to $16.40.  I haven't seen it in the news yet but yesterday's factory orders came up as expected +2.1%.  This morning's reports: Trade Balance and ISM Services.  "Couldn't-resist" dept.:

• 'Sell In May' Is a Big Mistake Historically - Chris Ciovacco, Ciovacco Capital
• Male Investors Vs. Females: How They Compare - Georgette Jasen, WSJ
• European markets buck China concerns
• Discrediting Europe's Economic Austerity Myth - Alan Reynolds, Investor's
• I Want a President Who 'Gets' the Economy

[expat_panama]

[expat_panama]

Waking up to interesting times--  pundits may want to say (correctly) that we're retesting support but it's a great day of calling patterns.  Post 17 makes stocks look like we're forming a bullish pennant, but there's reason to think metals prices have been bearish.  Reports for today--

MBA Mortgage Index
ADP Employment Change
Productivity-Prel
Unit Labor Costs - Prel
Crude Inventories
 

--(imho) were starting out negative but futures traders are calling the news "good".

[abb]

Wake Up! NOW, what do we do?!?!?!?!

[Lurkina.n.Learnin]

The way I see it, it could go up from here or it could go down. Who knows?