Considering that markets have more or less “skyrocketed higher” for such an extended period of time that the majority of investors / traders are likely convinced that this is just the “new normal” ( I can’t stand that expression by the way – as it reeks of complacency and “idleness”) and that dips should be bought, on and on, no worries, The Fed has your back etc etc…
It’s easy to understand, as even heightened geopolitical concerns continue to take the back seat, along side lowered global GDP forecasts, poor data out of Japan etc..It could easily appear to the casual observer that “nothing” can get in the way of markets just moving higher, and even higher.
But what happens when the turn is made? I mean…..we all have to appreciate that “nothing goes up forever” right? Historically speaking we can see the typical “boom and bust cycle” usually manifests in a “5 year up and 2 year down” type scenario – and we’re well past the 5 year up mark.
As investors / traders it would completely foolish to “simply ignore” these longer term patterns as I can imagine most of you…..have likely been caught doing that a time or two before right?
Tech / boom / crash 2000 maybe? Credit / housing / crash of 2007 perhaps?
I find it highly unlikely that many of you successfully navigated these “significant turns” to continue generating profits during the 2 year period following these incredible crashes in risk.
Take a look:
Market_Tops_Forex_Kong
Market tops can be seen almost “to the letter” on a 7 year cycle with 5 years up….and 2 years down, with us sitting “right at the max” of this “extended 5 year move higher” based solely in the “money printing efforts” made by Central Banks.
The idea of going through this again ( as why would this time be any different? ) can’t possibly be appealing. Considering where you are in life, and the prospects of a “full 2 years” with your portfolio drawndown considerably – not to mention the mental and psychological end of things – who needs the grief?
You’ve come this far with your investing / trading decisions while the “good times have been good” so…..why not extend the same effort when ” the good times are bad”?
Suggestions to follow….
Remember the company I mentioned a few days ago, RZZ?
Here is yesterday’s NR:
http://www.reuters.com/article/2014/08/05/idUSnMKWMvcq7a+1e0+MKW20140805
And here is the gem from the new CEO:
Abitibi Royalties is a very unique opportunity and has the foundation to become one of the best gold companies in the world. Not the biggest, but the best.
Obviously I can’t endorse the company / stock as it’s got zero trade volume / isn’t even on the radar in any “responsible sense”.
There would be “a million and one” better ways / more “responsible ways” to take advantage of the “good times in gold” soon to be had so… readers can research / invest as they see fit.
I’ll give you the plug….but in all it’s about as low on the totem pole as it gets.
You are right. It’s thinly traded.
I will write back when it triples (it’s already up 8x from the lows of Dec 2013).
For you, putting a few $k and forget about it for a little while should do it.
I trade a lot, sometimes overtrade. Only stocks, not Forex.
Good luck!
per your chart, how can this possibly be a “new secular bull market” when you yourself said it was “”this “extended 5 year move higher” based solely in the “money printing efforts” made by Central Banks””
doesn’t that pattern look like a megaphone pattern? And wouldn’t the logical conclusion be that the next bear goes lower than the last? it also appears by your chart that you are implying that the 2007 top will act as support but i can’t see how since, as you said, this market is based on central bank printing.
i can’t see anywhere but down from here (eventually) and i don’t know how another bull market can manifest itself due to the simple fact that 10,000 boomers are retiring every week for at least the next decade and most i know don’t earn enough to afford the ‘American lifestyle’ that existed prior to 2000….at least at today’s price/wage levels
just my .02
Ya sorry about the chart as its not “Kong original” but a cut / paste job.
I was only looking to point out the “near term turn” at the levels we currently sit, with thought in mind of lower from here, and for sveral years to come….although..
For anyone looking out this far…..you’ll have to “of course factor in” that at any point along the way ( who can ever say exactly when ) QE will be not only re instated but likely doubled / tripled so…
2017 is a looooooong ways away…and who knows new revolutionary industry / space tourism / bio med etc….could easily factor in.
Remember “before there was the Internet”?
Amazing things coming just around the corner……where “real growth” will eventually be found.