We do not make end of 2018 forecasts. I think it's irresponsible to think that we have any idea of what will happen a year from now. We want to reevaluate our thesis as time goes on and new data comes in. This reevaluation process occurs consistently throughout the entire year. How else can we manage risk responsibly? Are we supposed to place our bets after New Years and just hope for the best? Come on.
Take a deep breath. Forget everything we did this year and only think about where we are today. The idea is to keep an open mind and keep every option available. If we've loved something in 2017, that doesn't mean we can't hate it in 2018. Just because we've been shorting something this year, doesn't mean we can't be buyers in the next coming quarters. We're not here to be right, we're here to make money. We can't forget that and let ego take priority over profitability. It's important to be aware of our cognitive behavior patterns and this is one of them.
Every month I host a conference call for All Star Charts India Premium Members where we discuss ongoing themes throughout the India Share Market. We take a look at all of the NSE Indexes and Sectors as well as some of our own custom indexes. At Allstarcharts we have become known around the world for the top/down approach to stocks. After we analyze each of the indexes and sectors and have identified where the strength and weakness lies, then we break it down to individual stock opportunities. By having momentum, relative strength and market trend in our favor, the probabilities of success increase dramatically.
I don't make as many TV appearances as I used to when I lived in New York City, but when I'm town I love to swing by the FOX Business studios to chat with my old pal Liz Claman. She respects our Technical approach and understands the value that we bring to both institutional and retail investors.
This week I sat down with her to discuss the risk vs reward opportunities we currently see in the S&P500, Bitcoin and Steel Dynamics $STLD. I think this conversation was quick and to the point, just how we like it.
Pretty much every day for the past 15 years I've been asked the same question: What should I invest in? The way I get asked is always changing, of course. It's been, "How many houses should I buy in Miami since real estate only goes up?" to, "Which marijuana penny stock should I buy?" to, "Which crypto do I buy" (not if. which one?). The "sexy assets" of each era are all different, but the idea is the same. Because of my interest in markets, this question is constantly fired my way.
The answer I give isn't always well received, but it comes from the bottom of my heart. If you want to invest, where better to do that than in yourself? Go buy a book and spend the time to read it. Go reach out to someone you look up to and buy them a drink, or coffee or lunch and learn from them. Go travel to a far away land and meet with the locals. All of these "investments" are probably going to go a lot further than the litecoin you just bought because your nephew told you it's a good idea and you saw someone talking about it on the tv.
This week I was in New York City working on some really cool things that I'll be announcing next quarter. It has been an incredible year and I think 2018 is going to somehow be even better! While I was in town, I swung by the Nasdaq Marketsite to chat with my friends over at BNN in Canada. They wanted me to talk about my thoughts on Bitcoin (of course), precious metals and U.S. equities.
It was a quick hit but I think I laid out some really interesting opportunities with very well defined risk parameters. As long as the potential reward is exponentially greater than the risk and the trend is on our side, I see little reason not to be all over these. There have been some very powerful trends in these markets over the past few years that I think continue into 2018.
What often gets lost in the shuffle between whether or not to buy emerging market stocks is the fact that there are several important components within the group. Emerging markets aren't just one thing. They are a collection of major markets around the world that are not yet fully developed.
Today we're talking about the structural breakout we're seeing in shares of the India Exchange Traded Fund $INDY. Look at the former highs in 2011 that were tested again in early 2015. This year prices were finally able to break out above that key resistance to begin a new leg higher. These are characteristics of uptrends, not downtrends. The weekly bar chart tells the story well:
These are the registration details for our live monthly conference call for Premium Members of All Star Charts India.
This month’s Conference Call will be held on Tuesday, December 21st at 7 PM IST. As always, if you cannot make the call live, the video and slides will be archived and published here along with every other live call since our launch.
In the world we live in today, it's hard to find someone that is excited about Consumer Staples. "Why, do they have a new digital coin out?" is what you might hear. While some people treat the the volatility in certain asset classes as something to be distracted about, we just look at bitcoin and its fellow coins as another investing vehicle. Consumer Staples have just as important of a role in our process. Today, I want to talk about the breakout we've seen this week in the Equally-weighted Consumer Staples Index Fund.
The way I learned it, the bigger the base, the higher in space! We want to buy breakouts from markets that have been range-bound for a while. Consumer Staples are one of them.
I have a workbook of charts where I keep the entire list of stocks in the Consumer Staples Sector. With the Equally-weighted Consumer Staples Index breaking out of a multi-year base, we want to find the stocks that are going to lead this sector higher.
Here is a list of the ones that stand out which are showing strength and a risk vs reward skewed in favor of the bulls following the longer-term and shorter-term uptrend in Consumer Staples:
One thing I feel has gotten lost in the whole "Stocks and Bitcoin make all-time highs every day"rhetoric is the overwhelming weakness in precious metals. Gold, Silver, Platinum and Gold Mining stocks are all making new lows, resuming their trend of lower lows and lower highs.
We've been aggressively bearish Gold, Gold Mining Stocks and anything precious metals really since October. Based on what we've seen since then, I see no reason to change our approach towards this market. To the contrary, I think the selling we've seen come in confirmed everything we had been seeing in September - a bunch of people getting caught long in a bull trap. It was classic.
