S&P and all indices at records - Wow Trump did have a huge impact on markets. Where do we go from here?

Welcome to the era of Trump and record high markets:

First of all, I wanted to apologize from being away so long from writing my blogs. Due to personal medical reasons, I was unable to keep my blog updated.

Well, we are definitely in the record books for sure. All indices at all time highs, financials were up, airlines up - everything is and has been going up. Financials did pull back from their highs after the Trump agenda does not seem to be materializing. But tech stocks - unbelievable run - all semi stocks, NVDA, AMD and many others are trading like it is 1999. Many amateurs are jumping into the market and let me tell you, I lived through 1999-2000, cashed out at the top - and this is looking like deja vu all over again - maybe to slightly smaller extent. Stocks are trading at sky high valuations and nobody cares, the media just keeps priming the pump and the bubble - along with the Fed.

It has been a nice run and we are still not seeing any real technical weakness - except in the financial stocks. AMZN, GOOG, FB, NFLX (or FANG stocks) along with TSLA are trading at valuations that are the GDPs of many nations combined together. I think it is getting crazy - but make hay while the sun shines. There is no regard for risk or risk aversion and therefore one as an investor or trader needs to make sure they have their stops in place. This is a good time to have one foot out the door. 

There is no question that this is a liquidity driven bubble, the Fed and all central banks are driving this bubble with no regard for the debt and market valuations. You can tell you are in a bubble when the markets and certain stocks bounce back to new highs even on bad news - mind you there has really been no real growth in revenue - there has been financial shenanigans and financial engineering to create wonderful rosy outcomes. Huge stock buybacks, and setting expectations low with the analysts community - and then during earnings season beating the estimates - sounds like a nice scam to me. But the SEC is powerless entity and they just play along. 

Anyway, we think there is still room at the top. With all this talk (no action) about tax reform, health care reform, infrastructure - well Mr. Trump does not seem to get that this is not like erecting a skyscraper - or just making a golf resort - this is the government and the government does not run like a business - and you cannot run it like a reality show - he just loves showmanship. Anyway, back to the markets.

So we like the following stocks - AAPL, WDC, PANW, INTC, QCOM - there are many others, but we are being opportunistic in our trades and watch for new highs and breakouts. We also look at the technical end of day reports from our site at www.trucharts.com/marketreports.aspx - look for RSI less than 30, improving RSI, TC Positional Buy signals and MACD crossover reports. 

The unemployment picture is not looking good - debt at consumer level is at record highs and this is already impacting the retail sector - obvious from the store closing and stock prices. Leadership is narrow and housing is looking like a major bubble - rides along with stock prices. 

We are in a bull market and heading higher into the IPHONE 8 season and going long AAPL is a good trade. Keep good stops and wait for our next update soon.


Good luck trading.

Trucharts.com
Founder