Rob.Reynolds
Short

S&P500 earnings multiple will fall while prices rise CONTRARIAN!

FX:SPX500   S&P 500 Index
Wages are growing above and beyond inflation at present, after a 21% rally I lean towards a near term correction followed by a rally in tandem with earnings multiples falling.
Interesting analysis, thanks
That's what I see hapenning on a bigger scale:
+2 Reply
Excellent video, there is nothing inherently bullish or anywhere near sustainable about the massive rally we've had thus far and while I wouldn't be surprised to see a new high I have to believe there will be a double digit percentage dip before we enter a more 'traditional' market cycle. I am a user of Elliot Wave as well and SPY looks to be in an expanding diagonal with its wild swings, the next one down will be very interesting. Thanks to the Fibonacci levels we can easily derive where to look for support and potentially exit short positions should they break.
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Rob I don't think we will roll over to the 61.8%. I think the daily chart will continue to rise for a last phase of the cycle until the data shows economic slowdown and we start contraction. Now that we have the Fed put, this is what the smart money will be doing until late 2019 2020 (when data turns sour). Unless we get some majorly bad economic news, we could make an all time high again. I think what we have seen over the last two months is buying on the back of dovish rhetoric. Now we have broken that major resistance zone you have there on the chart pre official fed meeting this week. We will get a confirmed dovish stance this week and stocks will soar the trend into new highs.
+1 Reply
I tend to agree @giltwenty

I had a very interesting conversation recently, I was asked: "are you prepared if the cycle lasts another 4 years". Although highly improbable if we have learned anything its that the impossible is possible.

The reality is that the data is growing, albeit at a slower pace. I have to be bullish until that changes, to protect myself and my capital I have different stages to overlay my process. The last is TA, and Elliot Wave has been good to me over the years. If you are right, I will have to accept that as a missed opportunity.
+2 Reply
Rob.Reynolds Rob.Reynolds
@giltwenty thank you for putting the effort into this comment, I really appreciate it!
+1 Reply
giltwenty Rob.Reynolds
@Rob.Reynolds, One thing I don't think a lot of people realise is that you have to build your own strategy that works, stick to it and accept the losses and missed opportunities. There are always losses and always missed ops, but if you can work like a casino and over the long run keep a good win rate with good risk rewards you will make money. No strategy has zero losses! keep up the good work Rob! love your humility.
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