Crazy markets and bubbles in process:
It has been quite some time since we wrote up our thoughts on where we are on the markets and the latest news.
We have been steadfast in our commentary that this market is a bubble which has grown bigger after Trump's election. Stocks were moving up exponentially and some still are - and we are seeing this in primarily the software companies and this sector is trading at unheard of valuations. Majority of these stocks are trading at valuations that are reminiscent of the dotcom stocks..
Just go check the list and price/sales ratios of some of these companies - check stocks like TEAM, NOW, ZS, OKTA, SPLK, ADBE, SHOP and many others in this sector. The list is long and we will publish a table of these so you can see this crazy bubble behavior.
Take a look $TSLA - stock moves over $100 per day. Stocks like $AAPL have moved over 80% in less than a year and yet many other big cap tech names are moving in an exponential fashion. This is all a result of the Fed, PBOC, BOJ and ECB money pumping into the system - revenue growth is less than 10% - eps growth YoY is stagnant - yet stocks keep moving up.. Low interest rates and the Fed put are going to make this bubble much bigger - we expect the Dow to go to 40000 and NASDAQ to cross 10000. So for now the tagline is - Just Keep Buying - not a single Fed member has uttered the words bubble - at least Greenspan had the balls to utter the words 'irrational exuberance'. At present, we are way beyond irrational exuberance uttered words with EV/S (Enterprise value to Sales) ratio at the highest level in history along with P/S (Price to Sales) ratios of many companies at unheard of levels - just take a look at PAYC - trading at over 27 times revenue - and the Fed bobble heads - say valuations are little high - I think these guys smoke pot together in a room and get high - Yellen/Bernanke have taught Mr Jay (we cal him Jerry from Tom and Jerry) that bubbles are good and to keep pumping..the money spigot...
So if you ain't making money in this market - guess who is the monkey.. The Fed is giving a hand to everyone to make insane amount of money and if you do not see it - its your fault.. Stocks are being traded by the machines and have become insanely predictable... Go check our site in the screener section and why we run certain screens - these are to quickly identify stocks that we can trade..
Here are the links - we have a multiple technical screener and a single dynamic screener:
The big industrial stocks are crumbling but everyone in the DOW is moving to stocks like UNH, MA, AAPL and MSFT. Stocks like CAT, DE are trading at reasonable prices - but not from a fundamentals perspective. Make a list and trade it.. hold for a day or so and then sell it.. This is not a buy and hold market. We will do a video and post it on youtube channel and publish the link in an upcoming blog post.
Here is a suggestion - look for stocks trading at RSI (Relative strength index less than 30). Or Bullish MACD crossover stocks.
We are now providing free real time quotes and charting on our site. Check it out and for a small annual fee you can get access to our technical alerts.
https://trucharts.com/StockCharts.aspx - for charts and company detailed data.
Now time to make some $$$$..
Good luck trading.