I just want to state that despite last week being quite terrible on the market that I actually think there will be an upsurge any time now that might shock people. I’m thinking along the lines of 2.5% gains in major indexes of the US market in a single day to come.
I usually refrain from crystal balling the stock markets, however this time I am willing to take the risk of sounding stupid, if things don’t play out. Lately I see the current declines of the market to be related to an onslaught of bad news.
Despite all the bad news, Vectorvest, my source of wisdom in the market tells me interesting information. It does an analysis of stocks on the basis of their assets, future inflation, along with a growth rate prediction. This source of information tells me that, from the time the Dow Jones hit that glorious 10,000 that the valuation of all the companies in the Dow hit 12,000+ and that now it has hit 13,000+.
I am an Austrian myself with economics, but founded on a lower dollar and high oil or not the Dow Jones still has a long way to go before a serious underlying bear market trend kicks in. This also tells me that the US dollar has a lot of room to move lower, and that the price of oil is moving up.
In the short term, as in three months, stocks with strong fundamentals and P/E ratios are going to be on the upswing. I urge people to stay the hell away from stocks that have a weak or speculative outlook.
If you are completely new to the market or too scared to start I advise looking at Updown, a simple virtualized trading platform that allows you to see how good you can be in the US market.
I want to talk more about Vectorvest, which has a great history. Four months before the september crash in 1987, its valuation of the Dow Jones shifted below its price showing the market was overvalued. There is a similar story behind 1990′s bear market and the October 2008 crash. Great men have said the timing is the hardest part, yet Vectorvest gets it closer than anyone.
I think more than anything people need to understand the relative value of money. With the US dollar going down, and beyond what foreign exchange will say about it, that the money supply has increased vastly means that there will be new highs seen on major indexes that surprise people.
However, the sooner the market climbs the faster it is going to get to that 13000, 15000 mark on the Dow Jones which is probably where it will start going down again, and down fast.
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