• 20 hours Trump Prepares For Another Key Tariff Decision
  • 1 day The Free Money Bubble Is About To Burst
  • 2 days The Crushing Reality Of Poverty In America
  • 2 days Should You Buy Into The World’s Largest IPO?
  • 2 days The Infinite Possibilities Of Cosmic Energy
  • 3 days Analysts Link Walking To Economic Growth
  • 4 days Will Japan Turn Its Back On The Aramco IPO?
  • 5 days Global Debt Soars To $188 Trillion
  • 5 days The World's Largest Gold Miners Are Getting Creative
  • 6 days Twitter: The Saudi Spy Tool To Bring Down Dissidents
  • 6 days Broad Commodity Funds Don’t Give Enough Exposure To Gold
  • 7 days Here We Go Again: Another Giant Telecoms Mega-Merger
  • 7 days World's Largest Gold Miner Sees Profits Triple
  • 8 days Microsoft Japan Trials 4 Day Work Weeks, Productivity Soars By 40%
  • 8 days Hedge Funds Lose $4 Billion In Four Days As California Wildfires Rage On
  • 9 days New Viral App May Be A National Security Threat In Disguise
  • 9 days China's $10 Trillion Space Play
  • 9 days Human Energy: Debunking The Matrix
  • 10 days Cannabis Has Become A Real Estate Selling Point
  • 11 days The Gold Stock Boom Is Just Getting Started
Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

Zombie Foreclosures On The Rise In The U.S.

Zombie Foreclosures On The Rise In The U.S.

During the quarter there were…

Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

  1. Home
  2. Markets
  3. Other

Stocks - Buy the Dips or Sell the Rallies?

Summary:

Sometime not too far off, there will likely be a stock rally that will last for a while. I doubt, however, yesterday was its beginning.

Yesterday's rally had the CNBC crowd frothing at the mouth, extolling the advance as the start of something "big." As you would expect, there was congratulatory banter about the wisdom and rewards of having bought the recent dip!

The gains were indeed spiffy -- my tracking group advanced an average 2.1% (median = +1.7%) -- but based on the technical picture I now see unfolding, I don't believe this advance will have much staying power. Based on very rough calculations, here's what I see as the "best case" for the immediate future:

  03/25
Close
Projected Maximum
Points Price Change
DJIA 10,219   194   10,413   1.9%  
S&P 500 1,109   22   1,131   2.0%  
NAZ Comp. 1,967   43   2,010   2.2%  

I emphasize that as I see the situation right now, the above is best case, and for all I know, "best" may not even be good enough to get entirely through today's session.

Here's what I see setting up for the next few months.  At the moment, this "big-picture" outlook is rough and tentative and will need some tightening up along the way. But here goes:

* New lows (lower than this week's lows), by early to mid April.

* These new lows are then followed by a decent but doomed rally that falls short of taking out the respective highs that were set by the seven components in my tracking group between late January and early March. In other words, I am talking about something that could turn out to look devilishly like a major; "failing rally." For the sake of argument right now, let's say this process runs into May -- perhaps well into May -- before it is complete.

* Then, the stock market segues into what will be a decidedly bad June-July period.

I fully realize that the above template falls far, far outside the current consensus view, which continues to put a lot of faith in the so-called "Presidential election cycle."  I also realize that should the above configuration come to pass, it holds out the strong possibility that the market already has made the highs for this year. Which, in turn, this could surely have an impact on the November election.

Nevertheless, this is how I see the situation at the moment, but be assured I will be carefully monitoring and updating what I have laid out here as the coming weeks unfold.

Back to homepage

Leave a comment

Leave a comment