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US Stock Market Outlook 9-1-16 (video)

This video provides an overview of the near-term, intermediate-term & long-term outlook of the US stock market using both technical & fundamental analysis. The first part of the video starts out with a look at the daily time frame, outlining what I believe to be the two most probable scenarios in the stock market from an intermediate to longer-term perspective. At the 11:32 mark, the focus turns to the near-term outlook with analysis of the 60-minute charts, concluding at the 17:40 mark.

For those interested, after the 17:40 mark, I touch on today's ISM Manufacturing Index report, followed by some macro or very longer-term fundamental headwinds that the US stock market is likely to face in the coming years. The video is a bit on the longer-side so if you're pressed for time or not overly concerned with the very long-term outlook for the markets, the first 17:40 of the video covers most of the salient technical levels & developments that swing traders & investors should be aware of at this time.

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Sep 1, 2016 12:30pm|Categories: Equity Market Analysis|Tags: , , , |5 Comments

5 Comments

  1. dan123 September 1, 2016 1:23 pm at 1:23 pm

    Great video Randy i like the correlation you made with the SP and 30 year treasures. So if interest will rise the housing market and stock market will crash unless they will find a way to deflate the dollar by introducing the SDR

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    • rsotc September 1, 2016 1:53 pm at 1:53 pm

      dan- I wouldn’t say that a market crash, at least based on anything on those 40+ year long-term charts is very likely but that all depends on how fast & far rates rise once they finally do embark on a new bull market. Rising rates (referring to a clear & sustained trend) could also be months & possibly years away as the possibility that interest rates pound out a lasting bottom while basing in a sideways trading range is always a possibility.

      Also keep in mind that even if the US were to begin a new secular bear market in the coming years, it would almost certainly be similar to that of Japan’s, at least in the sense that it would be marked by very strong & clearly trending cyclical bull & bear markets within the larger secular bear market. As traders & even long-term investors, we don’t really need attempt to position for a secular trend lasting decades, as the scope of the cyclical bull & bear markets within are large enough to profit from trading long & short yet much to large to avoid being stopped out on the counter-trend (cyclical bulls & bears) rallies if one were to try and position with buy & hold investments for the secular trend.

      The take-away from highlighting the relationship between secular trends in rates & the stock market is more so to help one formulate their longer-term investment strategy (i.e.- it might not be wise to for a 20 year old or a 30-something to assume a 12% average annual return when calculating his/her projected 401k balance (as most 401k’s don’t allow shorting & only offer 3 options: cash (money market fund), long equities (via various stock funds) or long fixed income (via various bond funds). Should we experience a secular bull market in interest rates (which would translate into a secular bear market in bond prices), that eliminates bond funds from doing their part & likewise, a secular bear market in stocks would be devastating for buy & hold investors while active traders or even semi-passive investors that are adept at technical analysis (and fundamental analysis would help too), should be able to successfully navigate the changing cyclical trends, ideally capturing the bulk of the bull trends while moving a large portion of their account to cash and/or bond funds (assuming the charts confirm) during the cyclical bear trends.

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  2. dan123 September 1, 2016 3:10 pm at 3:10 pm

    Thank you.

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  3. rsotc September 2, 2016 9:46 am at 9:46 am

    It was brought to my attention that I had incorrectly stated in this video that the S&P 500 has not made new highs in decades. The S&P 500 did recently make a new inflation adjusted high & closed yesterday up a mere 4.25% above the previous inflation adjusted high of 2082.26 back in August of 2000. Still an essentially flat return for the market over the last 16 years but I just wanted to post the correction. Thanks for pointing that out DD!

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  4. lee1 September 3, 2016 12:11 pm at 12:11 pm

    This market cannot even close below 2160. Until it does the bears will just continue to be wrong. Every dip is bought up so that should tell one something irrespective of all these divergences and other negative indicators.

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