8 Reasons to Short the Stock Market (Part One) #stocks

SP:SPX   S&P 500 Index
3839 23 80
(1) Market Valuation: 4 main measures of market valuation is signalling markets are overvalued
Shiller PE ratio for the S&P 500             . A well-known measure of market valuation. It is based on average inflation-adjusted earnings from the previous 10 years, known as the Cyclically Adjusted PE Ratio. The Ratio currently stands around 25, more than 50% above its mean(average).

The Q Ratio is another popular method of estimating the fair value of the stock market. The Q Ratio is the total price of the market divided by the replacement cost of all its companies. It currently stands around 1.09 , 59% above its mean of 0.68

Crestmont P/E ratio at 27.3 . 96% above its average

The Buffet Indicator: Market Cap to GDP
The indicator remains over 2 standard deviations above its mean, currently around 128%.

(2)Risk-off Environment
Junk bonds which are a great measure of market sentiment has been lagging in recent months, and breaking down.

Technical Breakdown
(3)Long term rising channel was taken
(4)12-month average was taken
(5) Bearish divergence on momentum

To be continued...
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I'm curious to read part two but it seems to be "hidden for violating one or more of TradingView's House Rules."
Hi, Technician, would you agree with me that starting from March 2009, we have just completed wave 3 and is in the process of seeing wave 4 unfold? That being said, once wave 4 is complete, we should look for a final wave 5 blowoff before the Big One?

A 68.2% retracement should take us to 1418 although a 38.2% retracement for a wave 4 seems more reasonable and that should take it down to 1732.
Beautiful article btw... very nice observations why it hasn't got 100+ likes I do not know....
Technician dionvuletich
:) .. I appreciate your gratitude.
Yup, shorted this at 2104.5 with a 4 point stop, hit 2x targets already and looking for final target just above 1700

Just entered another order to short I think around 2024 from memory...? not at platform so can't check.. getting into selling rallies mode
Technician dionvuletich
Best of luck buddy
+1 Reply
I believe the huge corrections in dow, s&p500, and nasdaq was mostly the fear and panic selling by traders reacting to China's failing economy. What matters is what happened after the quick downfall, market had no problem rising almost all way back up again. I take this to be a correction that was essential for the markets in order for them to continue higher. Are we done with the correction, we need to see stabilization in the markets before we see investors jumping back in and start buying stocks at cheaper prices. Great analysis by the way Technician, as always :)
Technician moneymaking
Thanks mate for your view. I think it is not a good time to buy stocks, you already know i have been a bear for quite some time. I think we are not heading higher any time soon, and at least we are heading for 25% correction.
+2 Reply
dionvuletich Technician
I agree with you tech
moneymaking Technician
isn't any correction beyond 20% taken as bear market reversal signal?
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