Best of the Week
Most Popular
1. TESLA! Cathy Wood ARK Funds Bubble BURSTS! - 12th May 21
2.Stock Market Entering Early Summer Correction Trend Forecast - 10th May 21
3.GOLD GDX, HUI Stocks - Will Paradise Turn into a Dystopia? - 11th May 21
4.Crypto Bubble Bursts! Nicehash Suspends Coinbase Withdrawals, Bitcoin, Ethereum Bear Market Begins - 16th May 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.Cathy Wood Ark Invest Funds Bubble BURSTS! ARKK, ARKG, Tesla Entering Severe Bear Market - 13th May 21
7.Stock Market - Should You Be In Cash Right Now? - 17th May 21
8.Gold to Benefit from Mounting US Debt Pile - 14th May 21
9.Coronavius Covid-19 in Italy in August 2019! - 13th May 21
10.How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part 2 of 2 - 18th May 21
Last 7 days
AI Stock Buying Levels, Ratings, Valuations and Trend Analysis into Market Correction - 17th Jun 21
Stocks, Gold, Silver Markets Inflation Tipping Point - 17th Jun 21
Letting Yourself Relax with Activities That You Might Not Have Considered - 17th Jun 21
RAMPANT MONEY PRINTING INFLATION BIG PICTURE! - 16th Jun 21
The Federal Reserve and Inflation - 16th Jun 21
Inflation Soars 5%! Will Gold Skyrocket? - 16th Jun 21
Stock Market Sentiment Speaks: Inflation Is For Fools - 16th Jun 21
Four News Events That Could Drive Gold Bullion Demand - 16th Jun 21
5 ways that crypto is changing the face of online casinos - 16th Jun 21
Transitory Inflation Debate - 15th Jun 21
USDX: The Cleanest Shirt Among the Dirty Laundry - 15th Jun 21
Inflation and Stock Market SPX Record Highs. PPI, FOMC Meeting in Focus - 15th Jun 21
Stock Market SPX 4310 Right Around the Corner! - 15th Jun 21
AI Stocks Strength vs Weakness - Why Selling Google or Facebook is a Big Mistake! - 14th Jun 21
The Bitcoin Crime Wave Hits - 14th Jun 21
Gold Time for Consolidation and Lower Volatility - 14th Jun 21
More Banks & Investors Are NOT Believing Fed Propaganda - 14th Jun 21
Market Inflation Bets – Squaring or Not - 14th Jun 21
Is Gold Really an Inflation Hedge? - 14th Jun 21
The FED Holds the Market. How Long Will It Last? - 14th Jun 21
Coinbase vs Binance for Bitcoin, Ethereum Crypto Trading & Investing During Bear Market 2021 - 11th Jun 21
Gold Price $4000 – Insurance, A Hedge, An Investment - 11th Jun 21
What Drives Gold Prices? (Don't Say "the Fed!") - 11th Jun 21
Why You Need to Buy and Hold Gold Now - 11th Jun 21
Big Pharma Is Back! Biotech Skyrockets On Biogen’s New Alzheimer Drug Approval - 11th Jun 21
Top 5 AI Tech Stocks Trend Analysis, Buying Levels, Ratings and Valuations - 10th Jun 21
Gold’s Inflation Utility - 10th Jun 21
The Fuel Of The Future That’s 9 Times More Efficient Than Lithium - 10th Jun 21
Challenges facing the law industry in 2021 - 10th Jun 21
SELL USDT Tether Before Ponzi Scheme Implodes Triggering 90% Bitcoin CRASH in Cryptos Lehman Bros - 9th Jun 21
Stock Market Sentiment Speaks: Prepare For Volatility - 9th Jun 21
Gold Mining Stocks: Which Door Will Investors Choose? - 9th Jun 21
Fed ‘Taper’ Talk Is Back: Will a Tantrum Follow? - 9th Jun 21
Scientists Discover New Renewable Fuel 3 Times More Powerful Than Gasoline - 9th Jun 21
How do I Choose an Online Trading Broker? - 9th Jun 21
Fed’s Tools are Broken - 8th Jun 21
Stock Market Approaching an Intermediate peak! - 8th Jun 21
Could This Household Chemical Become The Superfuel Of The Future? - 8th Jun 21
The Return of Inflation. Can Gold Withstand the Dark Side? - 7th Jun 21
Why "Trouble is Brewing" for the U.S. Housing Market - 7th Jun 21
Stock Market Volatility Crash Course (VIX vs VVIX) – Learn How to Profit From Volatility - 7th Jun 21
Computer Vision Is Like Investing in the Internet in the ‘90s - 7th Jun 21
MAPLINS - Sheffield Down Memory Lane, Before the Shop Closed its Doors for the Last Time - 7th Jun 21
Wire Brush vs Block Paving Driveway Weeds - How Much Work, Nest Way to Kill Weeds? - 7th Jun 21
When Markets Get Scared and Reverse - 7th Jun 21
Is A New Superfuel About To Take Over Energy Markets? - 7th Jun 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Sell Signal on S&P Global 1200 Confirmed by Various Charts

Stock-Markets / Stock Markets 2015 May 06, 2015 - 10:32 AM GMT

By: Brian_Bloom

Stock-Markets

Global Economy at Threat - The S&P Global 1200 index gave a significant sell signal today. Charting is viewed by some as tea leaf reading. However, over several decades it has been demonstrated as an objectively useful tool to strategic thinkers who attempt to monitor the health of the financial markets. The charts below are telling us that Quantitative Easing has run its course and that it has become impotent in the fight to stave off a global recession. Central Banks are now no longer part of the solution; they are part of the problem.


Below will explain why:

The sell signal on the S&P global 1200 chart below is evidenced by a lower low following retracement of break below the previously rising trend line. This is a potentially ominous development which the central banks will fight with everything at their disposal.

That they are fighting it is evidenced by the chart of the gold price – which is traditionally a safe haven, but the sell signal on the chart below might turn out to be a “false” signal – for reasons that will emerge in this analysis.

The US 10 Year yield broke above its falling trend line today. A break above 2.3% will “confirm” a possible change in yield’s trend

The US Dollar Index chart could go either way, but rising interest rates will not be good for either the US or the global economy.

Why would interest rates rise if money flows INTO the US?

The Dow Jones Industrial Index is once again at critical level. It may be signalling that money is about to flow OUT of US markets. Note how the index is battling to stay above the 50 day Moving Average, which is now pointing down.

The Transport Index is at critical support. In terms of Dow Theory (that was developed well prior to the emergence of the 1930s Depression), if Industrials and Transports break down simultaneously, this would indicate the commencement of a BEAR MARKET

Note that even if transports enter a Secondary Bear Market , the index could fall significantly (to below 6,000)

Conceptually, given that 90% of the US’s transport infrastructure is powered by oil, a continued rise in the global oil price might wreak havoc to the US economy (trouble in the Strait of Hormuz might interrupt the Middle East oil supply line)

(BB Aside Note in relation to the Strait of Hormuz: I will be writing an article to demonstrate that Iran is very probably a “Straw Man” of China and that Iran’s behaviour in the coming weeks should be viewed in that light)

If money flows out of the US because markets are falling, the US dollar Index will fall and US interest rate charts will break up – but, with S&P Global 1200 giving a sell signal, where will the money go?

The Hang Seng Index could fall to cover the gaps, so it won’t flow into China. Indeed, other evidence suggests that money is flowing out of China.

The Brazilian market is ramping up

The Bombay Stock Market in stratosphere. It is in a high risk area

Indeed, sell signals have been given (breaks below 50 and 200 Day MA)

Athens Stock Market might reveal a bearish high pole reversal in the coming days. This would imply (should it happen) that the Athens market could slump below its previous lows. Conceivably, a blow-up of the Greek sovereign debt problem might be used by the world’s Central Banks as a Straw Man for to camouflage the real impact of QE and the role that it played in what seems about to manifest.

So where will the money go?

Not into US Real Estate

Short term, it might flow into Euros (to cover the gap following the break below the 200 day MA)

But if Grexit manifests, then long term is anyone’s guess. In this context the gold price might “catapult” upwards if central banks withdraw from the gold markets. Unfortunately, a catapulting gold price will not serve to protect the global economy.

Conclusion

Taking all the above charts into account (and allowing a time lapse for one last burst of Central Banking shenanigans), the most likely outcome is that the global money supply will shrink as losses are incurred in the coming equity Bear Markets; because QE will have been proven impotent. The gold price should be watched very carefully for signs of upside reversal.

So this begs the question:

What should be done about all this? The answer is that the quicker we jettison the political posturing in a “democratic” world where both sides are really just throwing rocks at each other, the quicker we can close ranks and work out lasting solutions. Central Banks have lost the plot. The answers lie in “value-add” not in “money supply or capital market management”. China will not be a saviour of the global economy. To the contrary, China has its own agenda that runs counter to the Western value hierarchy. Arguably, the recent Iranian behaviour may be part of the Chinese Wu Chi strategy. My two fact based novels were an attempt to introduce and explore a “value-add” approach to solving the coming problems.

Brian Bloom

Author, Beyond Neanderthal and The Last Finesse

www.beyondneanderthal.com

Links to Amazon reader reviews of Brian Bloom’s fact-based novels:

The Last Finesse

Beyond Neanderthal

Beyond Neanderthal and The Last Finesse are now available to purchase in e-book format, at under US$10 a copy, via almost 60 web based book retailers across the globe. In addition to Kindle, the entertaining, easy-to-read fact based adventure novels may also be downloaded on Kindle for PC, iPhone, iPod Touch, Blackberry, Nook, iPad and Adobe Digital Editions. Together, these two books offer a holistic right brain/left brain view of the current human condition, and of possibilities for a more positive future for humanity.

Copyright © 2015 Brian Bloom - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Brian Bloom 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