Since 2008 we have had no real recession. 21 December 2019 we just hit the top resistance of ascending wedge on the monthly chart. Coincidence? I think not. Add the repo crisis like we had in september, trade war risk, and election uncertainty, brexit uncertainty, housing market bubble and dept buildup and we have are at more then enough to make this technical perspective come true on fundamental basis. Profit targets set at support levels, demand zones.
I agree with your overall premise but I believe 2020 will actually be a surprisingly good year for the market. Its painful to say, because like you say we haven't had a real recession in a long-time and this market has been artificially pushed higher from cheap money. When you look at the past 10 years, the economic growth in the US has been anemic at best and without QE and low interest rates this market would be far lower. Only in this last decade can we say 1.5-2% growth is "amazing". If you go back in history, 2% growth would be considered absolute garbage.
Having said that, I believe much of the headwinds that you have listed were moreso for 2019 which is why there was extreme volatility. In 2020, whether accurate or not, investors believe most of those headwinds are at-least on hold or neutralized which will push the market higher overall in 2020.
I do see some sort of correction sometime in Q1 of 2020 perhaps around February or March but I potentially see double-digit gains in 2020.
Where I am more worried is actually the end of 2020 heading into 2021. The upper channel if you follow Elliot waves is near 4000 and I believe there is a chance with QE, lower interest rates and Trump hyping more trade deals, this market can actually get there. In 2021 we start getting into a potential pension crisis when baby boomers start to retire and the money may not be there.
As disgusting as it sounds, I wouldn't go fully defensive yet in 2020 as I believe the SPX could actually boast a 15% gain. Having said that everyone should be slowly adding more and more money into Gold, Silver and Platinum.
Contrary to Trump's "the economy is amazing" and Powell's "interest rates won't go lower", I predict at-least 2 rate cuts next year as economic data weakens again mid 2020. My prediction is a cut around March, a cut early summer and potentially a third in late 2020. The reason I believe the market will go higher is I foresee US interest rates to be 0.25-0.75% by 2021 which means more cheap money for the equity market bubble.
- zSplit
CryptoPaily
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@zSplit, For gold,silver,platinum are you buying ETFs or mining companies?
For gold Im more of gold bullion guy and I like Franco Nevada for a capital appreciation growth and as a royalty stock. I don’t love mining companies because of the risk and it doesn’t fit in my own personal portfolio, however it may fit with yours of course.
Same idea for silver. Physical only. No mining stocks either.
For platinum I’m just in Impala Platinum which is one of the few players with giant upside.
Cheers!
CryptoPaily
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@zSplit, Thank you for the information. How much % capital appreciation did you get from Franco Nevada in the past years?
Silver also looks ripe for a bull run in 2020/21
I’ve been long in Franco since 90. I like it because they expanded their royalty platform to energy as well which is one of my top sectors for 2020 so I believe Franco will continue to post record revenue and profits. The stock is also not super volatile which is a plus.
Once gold starts to take off again in 2020 I can see it getting to the 150-160 range upon 1530-1540 gold spot.
markseddon23
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This isn't a rising wedge pattern at all. The upper trend line is way off.
Having said that, I believe much of the headwinds that you have listed were moreso for 2019 which is why there was extreme volatility. In 2020, whether accurate or not, investors believe most of those headwinds are at-least on hold or neutralized which will push the market higher overall in 2020.
I do see some sort of correction sometime in Q1 of 2020 perhaps around February or March but I potentially see double-digit gains in 2020.
Where I am more worried is actually the end of 2020 heading into 2021. The upper channel if you follow Elliot waves is near 4000 and I believe there is a chance with QE, lower interest rates and Trump hyping more trade deals, this market can actually get there. In 2021 we start getting into a potential pension crisis when baby boomers start to retire and the money may not be there.
As disgusting as it sounds, I wouldn't go fully defensive yet in 2020 as I believe the SPX could actually boast a 15% gain. Having said that everyone should be slowly adding more and more money into Gold, Silver and Platinum.
Contrary to Trump's "the economy is amazing" and Powell's "interest rates won't go lower", I predict at-least 2 rate cuts next year as economic data weakens again mid 2020. My prediction is a cut around March, a cut early summer and potentially a third in late 2020. The reason I believe the market will go higher is I foresee US interest rates to be 0.25-0.75% by 2021 which means more cheap money for the equity market bubble.
- zSplit