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Technical Market Indicators
Dow Theory, W.D. Gann, MetaStock, system tester, indicator builder, custom formulas, momentum, overbought, oversold, buy, sell, signals, top, bottom, Bull, Bear, consolidation, sentiment, contrary opinion
October 3, 2022
Preview from my weekly report*
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Stock Market Outlook: prices hit lower lows and remain systematically bearish.
All of our Colby Asset Management clients are completely safe in the Crash of 2022. We always emphasize safety of capital as our first priority. Our clients are avoiding losses and preserving their capital while we wait patiently for the next good market opportunity.
S&P 500 is now down 25% year-to-date. Our major trend indicators remain systematically bearish. Stock prices are a Leading Economic Indicator, so stock price weakness is warning of more economic distress ahead.
Great Britain's central bank, the Bank of England (BOE), was forced to intervene in the financial markets last Wednesday. The fast and steep rise in interest rates we have been warning about triggered a meltdown in complex financial instruments held by pension funds. The BOE said it would buy long-dated U.K. government bonds "on whatever scale is necessary" in an effort to calm markets and prevent the financial contagion from causing wider economic damage, the Wall Street Journal reported.
This BOE market intervention sparked chaotic price reversals across global markets, with some global stock market indexes up more than 2% on Wednesday. These gains were quickly erased, however. Experienced investors know that desperate actions by central banks are clear indications of distress in the fragile global financial system. As reported here for many months, Financial Stress is high and rising, and history shows that governments are not always able to control market forces. Market intervention by governments can have a short-term impact, but government intervention is unlikely restore confidence in government policies and fundamental conditions in the longer run.
Washington insider and former Treasury Secretary Lawrence Summers noted risks stemming from extraordinary volatility, leverage, policy uncertainty, high underlying inflation, and commodity uncertainty stemming from a war. Also, Summers was an early opponent of President Joe Biden's $1.9 trillion American Rescue Plan Act of 2021, because that macroeconomic framework risks an economic recession and market destabilization, in Summers opinion.
Economist Nouriel Roubini expects a hard landing for the U.S. economy, a long and severe recession rather than the manageable economic slowdown that Fed says it is trying for. Roubini also warned of financial market turmoil and a looming stagflationary debt crisis, as public debt levels have become unsustainable, as noted in our reports for years already.
Our full report reviews indicators that we monitor every day and offers clear and unbiased guidance on the following each week:
Global stock markets
The Defensive stock sectors
The Health Care sector
The Cyclical sectors
The Technology sector
The Financials sector
U.S. bonds and notes
Commodities (Oil, Metals, Agriculture)
Objective Quantitative Rankings for hundreds of Exchange Traded Funds
Now is the time to take action. Preserve your capital by placing your assets under our careful management--before the next major bear market of -20% to -50% devastates most portfolios.
Make no mistake, the ongoing global economic and financial crisis has not been fixed by any sound or lasting solution. History shows that the authorities will not protect you or give you any advance warning--but we will.
If you agree that making money while staying safe is better than taking big risks in the stock market and exposing your nest egg to potentially ruinous losses, we would be very happy to implement our time-tested strategies for all of your assets. It makes good sense to choose protection--especially at this time when the financial world is stretched out of proportion.
We are always happy to discuss your goals and concerns and answer all your questions.
Call us now for a free consultation.
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Top 10 Exchange Traded Funds
Weekly Rankings of Major Trend Relative Strength
My weekly Top 10 ETFs ranked by the Major Trend Relative Strength outperformed the S&P 500 by over an 11-year period of real-time weekly tests. Click here for a graph of simulated performance.
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See The Colby Global Markets Report (click here).
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My ETF Rankings are not investment advice. Rather, they are an objective ongoing research study.
Analysis of market forces may offer a sense of probabilities. But the many variables that can impact market prices are notoriously difficult to predict. And, market analysis is something less than an exact science. So, sound trading tactics are always recommended. See my Money Management Rules.
According to CFTC Rule 4.41, hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under- or over-compensated for the impact, if any, of certain market factors, such as lack of liquidity. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown.
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