Best of the Week
Most Popular
1. US Housing Market Real Estate Crash The Next Shoe To Drop – Part II - Chris_Vermeulen
2.The Coronavirus Greatest Economic Depression in History? - Nadeem_Walayat
3.US Real Estate Housing Market Crash Is The Next Shoe To Drop - Chris_Vermeulen
4.Coronavirus Stock Market Trend Implications and AI Mega-trend Stocks Buying Levels - Nadeem_Walayat
5. Are Coronavirus Death Statistics Exaggerated? Worse than Seasonal Flu or Not?- Nadeem_Walayat
6.Coronavirus Stock Market Trend Implications, Global Recession and AI Stocks Buying Levels - Nadeem_Walayat
7.US Fourth Turning Accelerating Towards Debt Climax - James_Quinn
8.Dow Stock Market Trend Analysis and Forecast - Nadeem_Walayat
9.Britain's FAKE Coronavirus Death Statistics Exposed - Nadeem_Walayat
10.Commodity Markets Crash Catastrophe Charts - Rambus_Chartology
Last 7 days
Silver Notches Best Month Since 1979 - 12th Aug 20
Silver Shorts Get Squeezed Hard… What’s Next? - 12th Aug 20
A Tale of Two Precious Metal Bulls - 12th Aug 20
Stock Market Melt-Up Continues While Precious Metals Warn of Risks - 12th Aug 20
How Does the Gold Fit the Corona World? - 12th Aug 20
3 (free) ways to ride next big wave in EURUSD, USDJPY, gold, silver and more - 12th Aug 20
A Simple Way to Preserve Your Wealth Amid Uncertainty - 11th Aug 20
Precious Metals Complex Impulse Move : Where Is next Resistance? - 11th Aug 20
Gold Miners Junior Stcks Buying Spree - 11th Aug 20
Has the Fed Let the Inflation Genie Out of the Bottle? - 10th Aug 20
The Strange Food Trend That’s Making Investors Rich - 10th Aug 20
Supply & Demand For Money – The End of Inflation? - 10th Aug 20
Revisiting Our Silver and Gold Predictions – Get Ready For Higher Prices - 10th Aug 20
Storm Clouds Are Gathering for a Major Stock and Commodity Markets Downturn - 10th Aug 20
A 90-Year-Old Stock Market Investment Insight That's Relevant in 2020 - 10th Aug 20
Debt and Dollar Collapse Leading to Potential Stock Market Melt-Up, - 10th Aug 20
Coronavirus: UK Parents Demand ALL Schools OPEN September, 7 Million Children Abandoned by Teachers - 9th Aug 20
Computer GPU Fans Not Spinning Quick FIX - Sticky Fans Solution - 9th Aug 20
Find the Best Speech Converter for You - 9th Aug 20
Silver Bull Market Update - 7th Aug 20
This Inflation-Adjusted Silver Chart Tells An Interesting Story - 7th Aug 20
The Great American Housing Boom Has Begun - 7th Aug 20
NATURAL GAS BEGINS UPSIDE BREAKOUT MOVE - 7th Aug 20
Know About Lotteries With The Best Odds Of Winning - 7th Aug 20
Could Gold Price Reach $7,000 by 2030? - 6th Aug 20
Bananas for All! Keep Dancing… FOMC - 6th Aug 20
How to Do Bets During This Time - 6th Aug 20
How to develop your stock trading strategy - 6th Aug 20
Stock Investors What to do if Trump Bans TikTok - 5th Aug 20
Gold Trifecta of Key Signals for Gold Mining Stocks - 5th Aug 20
ARE YOU LOVING YOUR SERVITUDE? - 5th Aug 20
Stock Market Uptrend Continues? - 4th Aug 20
The Dimensions of Covid-19: The Hong Kong Flu Redux - 4th Aug 20
High Yield Junk Bonds Are Hot Again -- Despite Warning Signs - 4th Aug 20
Gold Stocks Autumn Rally - 4th Aug 20
“Government Sachs” Is Worried About the Federal Reserve Note - 4th Aug 20
Gold Miners Still Pushing That Cart of Rocks Up Hill - 4th Aug 20
UK Government to Cancel Christmas - Crazy Covid Eid 2020! - 4th Aug 20
Covid-19 Exposes NHS Institutional Racism Against Black and Asian Staff and Patients - 4th Aug 20
How Sony Is Fueling the Computer Vision Boom - 3rd Aug 20
Computer Gaming System Rig Top Tips For 6 Years Future Proofing Build Spec - 3rd Aug 20
Cornwwall Bude Caravan Park Holidays 2020 - Look Inside Holiday Resort Caravan - 3rd Aug 20
UK Caravan Park Holidays 2020 Review - Hoseasons Cayton Bay North East England - 3rd Aug 20
Best Travel Bags for 2020 Summer Holidays , Back Sling packs, water proof, money belt and tactical - 3rd Aug 20
Precious Metals Warn Of Increased Volatility Ahead - 2nd Aug 20
The Key USDX Sign for Gold and Silver - 2nd Aug 20
Corona Crisis Will Have Lasting Impact on Gold Market - 2nd Aug 20
Gold & Silver: Two Pictures - 1st Aug 20
The Bullish Case for Stocks Isn't Over Yet - 1st Aug 20
Is Gold Price Action Warning Of Imminent Monetary Collapse - Part 2? - 1st Aug 20
Will America Accept the World's Worst Pandemic Response Government - 1st Aug 20
Stock Market Technical Patterns, Future Expectations and More – Part II - 1st Aug 20
Trump White House Accelerating Toward a US Dollar Crisis - 31st Jul 20
Why US Commercial Real Estate is Set to Get Slammed - 31st Jul 20
Gold Price Blows Through Upside Resistance - The Chase Is On - 31st Jul 20
Is Crude Oil Price Setting Up for a Waterfall Decline? - 31st Jul 20
Stock Market Technical Patterns, Future Expectations and More - 30th Jul 20
Why Big Money Is Already Pouring Into Edge Computing Tech Stocks - 30th Jul 20
Economic and Geopolitical Worries Fuel Gold’s Rally - 30th Jul 20
How to Finance an Investment Property - 30th Jul 20
I Hate Banks - Including Goldman Sachs - 29th Jul 20
NASDAQ Stock Market Double Top & Price Channels Suggest Pending Price Correction - 29th Jul 20
Silver Price Surge Leaves Naysayers in the Dust - 29th Jul 20
UK Supermarket Covid-19 Shop - Few Masks, Lack of Social Distancing (Tesco) - 29th Jul 20
Budgie Clipped Wings, How Long Before it Can Fly Again? - 29th Jul 20
How To Take Advantage Of Tesla's 400% Stock Surge - 29th Jul 20
Gold Makes Record High and Targets $6,000 in New Bull Cycle - 28th Jul 20
Gold Strong Signal For A Secular Bull Market - 28th Jul 20
Anatomy of a Gold and Silver Precious Metals Bull Market - 28th Jul 20
Shopify Is Seizing an $80 Billion Pot of Gold - 28th Jul 20
Stock Market Minor Correction Underway - 28th Jul 20
Why College Is Never Coming Back - 27th Jul 20
Stocks Disconnect from Economy, Gold Responds - 27th Jul 20
Silver Begins Big Upside Rally Attempt - 27th Jul 20
The Gold and Silver Markets Have Changed… What About You? - 27th Jul 20
Google, Apple And Amazon Are Leading A $30 Trillion Assault On Wall Street - 27th Jul 20
This Stock Market Indicator Reaches "Lowest Level in Nearly 20 Years" - 26th Jul 20
New Wave of Economic Stimulus Lifts Gold Price - 26th Jul 20
Stock Market Slow Grind Higher Above the Early June Stock Highs - 26th Jul 20
How High Will Silver Go? - 25th Jul 20
If You Own Gold, Look Out Below - 25th Jul 20
Crude Oil and Energy Sets Up Near Major Resistance – Breakdown Pending - 25th Jul 20
FREE Access to Premium Market Forecasts by Elliott Wave International - 25th Jul 20
The Promise of Silver as August Approaches: Accumulation and Conversation - 25th Jul 20
The Silver Bull Gateway is at Hand - 24th Jul 20
The Prospects of S&P 500 Above the Early June Highs - 24th Jul 20
How Silver Could Surpass Its All-Time High - 24th Jul 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Stock Traders Must Be Cautious Part III

Stock-Markets / Stock Markets 2019 Feb 22, 2019 - 04:44 PM GMT

By: Chris_Vermeulen

Stock-Markets

Welcome back, If you’ve missed any part of this multi-part research post, please visit www.TheTechnicalTraders.com/FreeResearch/ to review and read our previous posts.  This, Part III, of our multi-part research post where we are attempting to rationalize the continued bearish analysis of some other analysts as well as review some key data that may support our interpretation that the global markets are transitioning through a “revaluation phase” right now – headed for a breakout rally eventually will continue with more detailed information.  Our premise is that global investors and traders should stay cautiously optimistic at the moment and prepare for some volatility as this “revaluation phase” continues to play out.  Our overall analysis suggests that the US Federal Reserve and global central banks have “primes the cylinders” of the global economic engine sufficiently and that a spark is all that is needed to see massive new valuation and GDP increases within the next 10~20+ years.


Within the previous sections of this article, we’ve discussed how Globalization has expanded and normalized the global economic activities over the past 50+ years.  We’ve also discussed how this process of globalization has created a series of crisis events as localized central banks are now dealing with total globalization and the new risks that are associated with this transition.  Our position is that the economies of the planet are now more interconnected than ever before and, thus, the concept of a massive collapse event is less likely than ever before.  The only way a massive collapse event could take place, in our opinion, would be a global war between super-economies or a total collapse of multiple super-economies because of some catalyst event.  Otherwise, we believe the proper thinking is that of a “revaluation phase” not a “collapse event”.

Let’s dig further into the data and continue our research.

In the past, we’ve suggested that capital operates like a living organism, always in search of the healthiest environment to reside within and always attempting to identify and mitigate risk factors where they reside.  In other words, global capital is always seeking out the best, safest and most secure (immune from risk) returns possible at all times.  The recent globalization process creates a unique environment where capital can “transition” from one global market to another in an instant.  Risks can be identified and mitigated within minutes, hours or days now where, in the past, these risks could have been catastrophic in nature.

Within this new “instant” environment for capital and global markets, new risks persist.  Because huge amounts of capital can now move freely across global platforms and economies, volatility is likely to continue at 2x to 5x historical norms.  This also means that catastrophic regional economic events will likely result in more severe price rotation and speculation.  The end result is that capital is now flowing across the planet more efficiently than ever before and this creates a whole new playing field for investors and traders.

Consider the Global Gross Capital Flows below and pay very close attention to the change in how capital moved and was deployed prior to 2008 and on/after 2008.  If you read this chart as our research team sees it, we have entered a period (from 2000 onward) where massive amounts of capital have been dumped into the global markets.  Much of this capital has been deployed into infrastructure and supporting global banking and credit markets over the past 18+ years.  Yet a very large portion of this capital has yet to become fully activated in the global markets and this can clearly be seen by the reduced GDP output on this graph.  2015 Global GDP levels have dramatically changed and are very near pre-2001 levels in scale.

As readers of this article, the point we are trying to make is that “the guns are primed, loaded, aimed and ready for BUSINESS”.  The collapse of global GDP, which is clearly evident in the past few graphs we’ve presented, began to become clearly evident in 2014~2015.  An interesting facet of this contraction was that China instituted new Capital Outflow laws to attempt to prevent investment capital from rushing out of local Chinese markets at this same time.  The purpose of this was a protectionary move by China attempting to support their local credit markets and internal banking markets.  Unlike other global markets, China could not risk having large amounts of capital rush overseas (depleting repayment capabilities and local coffers) while continuing to build and pump up their credit/lending markets.  They had not considered the risks that Chinese investors/Entrepreneurs would take large components of their new wealth and aggressively move it outside the Chinese market.  Shortly after that, came the 2016 US presidential elections – which always present some level of rotation/contraction within the markets.

(Source: https://www.jvi.org/special-events/2016/global-drivers-and-effects-of-capital-flows.html)

As we move forward with this data and the key question we posed at the very beginning; are the Doomsayers right?  Do you believe the markets will collapse in the immediate future or do you believe the global markets are poised and primed for another massive price advance because of the massive influx of capital that has recently been dumped into the markets?

Let’s try to answer some of these questions by presenting clear data in regard to how the global markets have changed over the past 90+ years.  The GDP data below shows how different nations have rallied GDP output over the past 90+ years and how the dynamics of the global markets are taking root.  Remember the data we’ve presented earlier when you review these GDP graphs, below.  Remember that from 1970 till now, the US Federal Reserve and global central banks have poured over $40 Trillion US Dollars into the global markets and this capital is working through the banking system and economies in an attempt to solidify growth/return opportunities.

(Source:http://www.newgeography.com/content/005050-500-years-gdp-a-tale-two-countries)

If we were to total the GDP of the Top 5 economies on the planet for each of these graphs, the numbers would like something like this :

__ 1930: $2.87 Trillion Annually

__ 1980: $14.16 Trillion Annually

__ 2010: $43.84 Trillion Annually

__ 2015: $53.82 Trillion Annually

As we’ve seen from the previous data, the creation of capital by the central banks take a bit of time to settle into the global economies to begin producing real GDP advancements.  Additionally, we believe the 2009~2014 global credit market crisis was one of the biggest crisis events to “re-sync” the global markets in decades.  This event was similar to the 1929 US stock market crash in combination with the wars of the 1930s and early 1940s rolled all into one.  The primary difference between now and then is the fact that global economies are now very inter-connected and what took many decades in the past now takes only a few short years to recover.

What should we expect in the future and why are we cautiously optimistic about the next 2~5+ years, keep reading our next segment to find out.  We’ve covered almost all of the key data points that highlight what has transitioned in the past 40~50+ years.  Next, we’ll highlight why we are very optimistic that 2019 and 2020 will be incredible years for skilled traders and investors and we’ll show you what to expect from the US markets going all the way into 2021.

Isn’t it time you considered joining a group of professional traders, researchers, and friends to help you find and execute greater success in the future? Then visit www.TheTechnicalTraders.com to learn how we can help you find and execute better trades.  Take a look at some of our recent winners to see how we help people, just like you, create success.  We believe 2019 and 2020 will be incredible years for skilled traders and we are executing at the highest level we can to assist our members.  In fact, we are about to launch our newest technology solution to better assist our members in creating future success.  Isn’t it time you invested in your future success by joining a team of professionals dedicated to giving you an advantage in the markets every day?

Chris Vermeulen
www.TheTechnicalTraders.com

Chris Vermeulen has been involved in the markets since 1997 and is the founder of Technical Traders Ltd. He is an internationally recognized technical analyst, trader, and is the author of the book: 7 Steps to Win With Logic

Through years of research, trading and helping individual traders around the world. He learned that many traders have great trading ideas, but they lack one thing, they struggle to execute trades in a systematic way for consistent results. Chris helps educate traders with a three-hour video course that can change your trading results for the better.

His mission is to help his clients boost their trading performance while reducing market exposure and portfolio volatility.

He is a regular speaker on HoweStreet.com, and the FinancialSurvivorNetwork radio shows. Chris was also featured on the cover of AmalgaTrader Magazine, and contributes articles to several leading financial hubs like MarketOracle.co.uk

Disclaimer: Nothing in this report should be construed as a solicitation to buy or sell any securities mentioned. Technical Traders Ltd., its owners and the author of this report are not registered broker-dealers or financial advisors. Before investing in any securities, you should consult with your financial advisor and a registered broker-dealer. Never make an investment based solely on what you read in an online or printed report, including this report, especially if the investment involves a small, thinly-traded company that isn’t well known. Technical Traders Ltd. and the author of this report has been paid by Cardiff Energy Corp. In addition, the author owns shares of Cardiff Energy Corp. and would also benefit from volume and price appreciation of its stock. The information provided here within should not be construed as a financial analysis but rather as an advertisement. The author’s views and opinions regarding the companies featured in reports are his own views and are based on information that he has researched independently and has received, which the author assumes to be reliable. Technical Traders Ltd. and the author of this report do not guarantee the accuracy, completeness, or usefulness of any content of this report, nor its fitness for any particular purpose. Lastly, the author does not guarantee that any of the companies mentioned in the reports will perform as expected, and any comparisons made to other companies may not be valid or come into effect.

Chris Vermeulen Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules