Thread: FogSailing's Account Talk

Politicians love to make lots of promises. My first thought was if the total nonfarm payrolls were higher 2 years from now, but I see that stat has been steadily rising for years:
Graph: Total nonfarm payroll employment (seasonally adjusted)
There's always talk about more and more people dropping out of the workforce (and every time my wife are out and about on a weekday one of our topics of conversation is always "why aren't all these people at work!"), so maybe a better stat to watch for success is the labor force participation rate:
Bureau of Labor Statistics Data
If they succeed in lowering corporate taxes, and get that recent blip up to keep going up to 64% or higher, that would be a success.

My guess is the markets will continue to do well clear into the spring of 2018, then we'll finally get the much-needed recession to cleans things and cool the markets. So 2 years from now the indexes could be right about where they are now.

Off topic, boy has the seasonality of small caps kicked off with a bang. I moved from C to S a week earlier than I'd planned when I saw that happening Wednesday. This chart shows the surge in the ratio of the S to C fund indexes...I suspect this will continue, but at a slower pace:
$DWCPF:$SPX - SharpCharts Workbench - StockCharts.com

Congrats on catching those S Fund gains. I went to G just before the election. Was quite surprised to see the Dow Futures go from 800 down to new highs....who woulda thought...

Thanks for the feedback TS. Those are good measures to add to the list.

I'll give this a chance to get around. If there is enough interest I'll create a template on up to 5 indicators...Too many and it becomes burdensome..

FS

Still working on the 2018 Performance Predictions. Will post something soon to see if folks want to play...

This morning I read some interesting comments from an analyst and wanted to share: "..and yet it seems the markets have priced to perfection a massive infrastructure program for the industrials and a practical clean unchallenged repealing of dodd frank for the banks…..nothing will run as smooth as utopia…as of 2 weeks ago there were many inherent risks in a DJT win and now at this juncture risks are not even being factored ,,,,This is the classic absurdity of markets these days ..extremes….years of moves in a few days or weeks….also keep in mind it was the low interest rate fed driven environment that may have held up the markets from any major corrections these past couple years ..take that off the table and suddenly we are bullish due to fiscal spending? while the dollar rallies?? and rates rise? again this seems very suspicious to me...

Just a few thoughts that I'm considering before tip toeing back into the market: The dollar has surged but for how long will stay there? Tech stocks are already hurting from the strong dollars rise and international corporations would be appear to be ones that feel the pain. But if the dollar stays high, the market will need to adjust by doing what? I wouldn't be surprised by a sell off soon. I'm reading analysts talking about Trump Team is going to tear up the Iran agreement. What does that do to oil (and when)? Likewise, tearing up trade agreements with EU, Canada, Mexico, etc is going to warrant increased tariffs on American goods or other types of economic reprisals at some point. Also heard a rumor of a 1 trillion infrastructure package in the works...interesting times..

FS

Some trivia...found this interesting...

Recession and Elections
I recently noted that since 1910, the US economy is either in recession or enters a recession within twelve months in every single instance at the end of a two-term presidency… effecting a 100% chance of recession for the new President.

No recession without an election
I then spent some time looking at US recessions in general, and found that every single one occurred during, or just after, an election, without exception.

Not every single election sees a recession, only every two-term incumbent change. Some two-term Presidents saw recessions at their first-term re-elections too (Wilson and Eisenhower).
–Raoul Pal(My understanding is he is a smart investor and very knowledgeable of USD).

Also read this am that SPX is about to hit resistance and to expect a pullback of up to 40 points. Here's a bit of the info I picked up:

Today I show negative divergences on SPX Daily, SPX Hourly, Breadth, HYG:IEF. Also shown were positive divergences on the $VIX. This all tells me a turn lower on the SPX is coming, risk off.

The one saving grace is that my proprietary Technicals Model actually made a new high today. It usually gives advanced notice of turns, especially when something big is coming. So my conclusion is this, expect a turn lower, it may spook the market a bit. But I continue to hold a LONG position which is consistent with my Technicals Model and signals. I also want to point out that the cumulative Technicals Model is back (slightly) above its 200 dma, something we will continue to watch closely.

Finally, as I was looking at my SPX hourly chart, I said to myself that if I were the market, no matter if a bull or bear run is ahead for us, that I would like the tag the bottom extension of the triangle we watched in September which broke down in early October. That line is the yellow line on the SPX hourly chart, which as of today sits at 2112.

And just one more piece of info:

We think it’s likely that a rising USD is going to be the cause (of a possible recession) and will create difficulties as it rises further in value in the months ahead. I don’t think the USD is rising because of the small rate rise that is likely to occur in Dec. I think it’s rising (in no particular order) because of the election of El Donald whose policies are seen as USD bullish (far more than HRC’s were), the upcoming events in Europe (Italian referendum and serious issues with specific Italian and German banks which haven’t gone away and had simply been put on ice) and Japan, Europe and China’s desire to all weaken their currencies to stimulate their economies. The small US rate rise is just the icing on the cake that the news media (CNBC) talks about.

Best of luck to you in your investing.

FS

Originally Posted by FogSailing

Congrats on catching those S Fund gains. I went to G just before the election. Was quite surprised to see the Dow Futures go from 800 down to new highs....who woulda thought...

Thanks for the feedback TS. Those are good measures to add to the list.

I'll give this a chance to get around. If there is enough interest I'll create a template on up to 5 indicators...Too many and it becomes burdensome..

FS

I'm almost sick over missing out on the S fund gains.

Originally Posted by jkenjohnson

I'm almost sick over missing out on the S fund gains.

At least you are positive for the year.

Sorry buddy. The last two years have sucked for mr


Sent from my iPhone using Tapatalk Pro

Sorry to hear that. They certainly don't make it easy on us, do they?

Just some info from Raymond James that I thought was worth sharing.

https://raymondjames.bluematrix.com/...om&source=mail

FS

Getting to be a not so tough decision this week..

Waiting for some news to take the market back a bit...possibly the recount news but likely something else will show up on the radar...still waiting to jump back into equities but holding for now..
With respect to bonds, really quite comical………people are still pondering ….will the fed raise? Read that the 5 yr note yield has already doubled.. to almost 1.9 so who cares if they raise? It sounds like most of the world (the bond vigilantes) ….have already sold bonds long ago at 143. I think we're at about 101 currently so it may be time to begin to buy bonds again because they are at the bottom..

Of course, lots of bulls are expecting a 250 point week on the DOW ...we'll see..

FS

Finally, a short pullback is underway...hoping for it to hit support somewhere between 2177 and 2185 before either sideways movement continues or onward to 2270. VIX is up a tad today and SPX was in oversold territory this morning. With so much bullishness out there, sideways appears to me to be the most likely scenario in the short term. Will stay where I am and sell on Wednesday if things proceed naturally....Oh wait...what's that unnatural thing on the horizon.

FS