Stocks & Equities

The Big Picture Historical S&P Cycles: Nominal, Real, Gold & Silver (1928 – Present)

These four charts below are just the sort of Big Picture, long cycle perspective that so many investors overlook or simply have no knowledge about. These charts are not about making predictions, but rather, are about putting market action into some broader historical context. What has happened in the past? What is typical? Aberrational?


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Cdn. Mortgage rates – Spring cycle repeat?

  Due to an overwhelming number of inquiries over the past few days I am sending out this brief market update, which I know is a few weeks overdue for sure.

  The Spring market for purchase and sale has been extremely busy, as has the refinance side of things, as such finding the time to put something detailed together has been a challenge.  My apologies.

   Every Spring for the past three years we seem to have the same situation, it is starting to feel like that Bill Murray Movie ‘Groundhog Day’.

   A few Big Banks get their economists on the news telling folks that rates are moving up and they had better lock in, get out of the ‘risky’ (non-profitable) variable and into a nice ‘safe’ (profitable) fixed rate product.

   Then each year we see rates trickle back down to the same or lower levels as they were at before.  Lately all of the media attention has been on a 4 year fixed rate product that has in fact been around for months, and on a very limited ‘no-frills’ 5 year special – which ironically enough was available in November 2011 through the broker channel but received no fanfare.

   This Spring feels no different than the last three because bond markets, stock markets, and the world economy is not what is being talked about as the impetuous for a rate increase, instead it is the Banks ending a 4 year fixed rate special…

   There is still a 3 year 2.79, the 5 year rate remains at or near 3.19 with most lenders.

   You can watch the long version at this link and gain a better understanding as to just what is going on.

http://youtu.be/9KZg-k8ksVY

   Or the short version;

Prime is going nowhere, enjoy the variable.  Fixed rates will move around a little bit, however have a strong likelihood of staying very close to where they are.

   Kind Regards

   Dustan

   www.dustanwoodhouse.com

Dustan Woodhouse - horz

Current Gold & Oil Trading Patterns Unfolding

The past two months we have seen all the focus from traders and investors be on the equities market. And rightly so and stocks run higher and higher. But there are two commodities that look ready to explode being gold and oil (actually three if you count silver).

Below are the charts of gold futures and crude oil 4 hour charts. Each candle stick is 4 hours allows us to look back 1-2 months while still being able to see all the intraday price action (pivot highs, pivot lows, strong volume spikes and if they were buyers or sellers…).

The 4 hour chart is one time frame most traders overlook but from my experience I find it to be the best one for spotting day trades, momentum trades and swing trades which pack a powerful yes quick punch.

As you can see below with the annotated charts both gold and silver are setting up for higher prices in the next 1-2 weeks from a technical point of view. That being said we may see a couple days of weakness first before they start moving up again.

4 Hour Momentum Charts of Gold & Oil:


GoldAndOilGuy
 

Watch Full Video Analysis:

HERE

 
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“If there were one over-arching theme at the BMO Global Metals & Mining Conference, it was that the gold miners are upset and even embarrassed that their shares have so dramatically underperformed bullion…

“On the one hand, they were delighted in 2011 when it was reported that since Nixon closed the gold window, a bar of bullion had delivered higher investment returns than the S&P 500 for forty years– with dividends reinvested. But some gold mining CEOs find it an insult that what they mine is more respected than their companies’ shares…

“In our view, we have entered the most favourable era for gold prices in our lifetime, and the share prices of the great mining companies will eventually outperform bullion prices.”

Gold remains one of the most widely misunderstood assets in the investible world. Indeed, it may be better to refer to it as a means of saving that does not expose the saver to counterparty or credit risk or to the depredations of the monetary authorities.

As Don Coxe makes clear, governments are running deficits“beyond the forecasts of all but the hardiest goldbugs five years ago; central banks are printing money and creating liquidity beyond the forecasts of all but the most paranoid goldbugs a year ago.”

The choice for the saver is essentially binary: hold money in ever-depreciating paper, or in a tangible vehicle that has the potential to rise dramatically as expressed in paper money terms.

Gold prices have now softened, offering investors yet another chance to get back on board what is perhaps the most compelling form of money- and portfolio insurance available.

Why large cap gold miners are being so undervalued by equity investors relative to gold is an open question that takes us back to the realms of stories. That the discount exists is undeniable; all that is required to crystallise that value, we believe, is patience.

Gold: Timing and Targets From One of the Best

There were two back-to-back directional changes for February and March. The computer was dead right AGAIN. February went up, and March went down. Even the Panic Cycle hit on target. On top of that, the decline was a perfect double 8.6 frequency of 17.2 days. Perhaps those who like to try to take shots and say the 8.6 frequency is a bunch of bull, yet offer no empirical evidence to support their claim just opinion, when the Dow Jones Industrials fell for 17.2 months. Gold just fell for 17.2 days.

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10 Trading Thoughts That Should Not Be Thought

You can not expect to do well in the market if you look at investing in a normal way. By definition, being average is doing what most other people do and since investing is largely a psychological game, doing what other people do is only natural. Average results come from normal people acting in normal ways.

To beat the market, you have to be different.

Not necessarily in a straight jacket bouncing off padded walls different, just a little off.

Here are 10 things that may help you be a better investor, some ways to think differently from the crowd in that pursuit to achieve market dominance.

1. Do not think about making money, think about losing money – the first step toward success is accepting that losing is part of trading. You will not be right all of the time, you can not always trade your way out of a bad situation. There will be times when you simply have to walk away with a loss. The key is to keeping the losses small and manageable. When the market proves you wrong, take the loss.

2. Do not think you can average down to win – it is a logical idea, add more to a losing position with the expectation that the market must eventually go your way. Many times this strategy will work but, when it does not work, the loss may be insurmountable. The market does not eventually have to go your way.

3. Do not think that your success is entitled – you may make a great trade, pick a really great stock and have a feeling like you really have the market figured out. Forget your gloating, no one ever has the market figured out. We must always remember that we have to work as smart for the next trade as we did for the last.

4. Do not think that talent is required – making money in any trading endeavor is a small part technical skill and a big part emotional management. Learn to limit losses, let winners run and be selective with what you trade. Emotional mastery is more important than stock picking skill.

5. Do not think that you can tell the market what to do – the market does not care about you, it does not know that you want to make a profit. You are the slave, the market is your master. Be obedient and do what the market tells you to.

6. Do not think you are competing against other traders – trading success comes to those who overcome themselves, it is you and your persistent desire to break trading rules that is the ultimate adversary. What others are doing is of little consequence, only you can react to the market and achieve your success.

7. Do not think that Fear and Greed can ever be positive – in life, fear can keep us from harm, greed can give us the motivation to work hard. In the market, these two emotional forces will lead to losses. If your decisions are governed by either or both you will most certainly find that your money escapes you.

8. Do not think you will remember everything you learn – every trade provides a lesson, some valuable education on what to do and what not to do. However, it is likely that your lessons will contradict one another and lead you to forget many of them. Write down the knowledge that you accumulate, return to this trading journal so that you can retain some value from the lessons taught by the market. Remember, the market is cruel, it gives the test first and the lesson after.

9. Do not think that being right will lead to profits – you may be exactly right about what the fundamentals are and what they are worth. However, timing is everything, if your expectations for the future are ill timed, you may find yourself losing more than you can tolerate. Remember, the market can be wrong longer than you can be liquid.

10. Do not think you can overcome the laws of probability – traders tend to be gamblers when they face a loss and risk averse when the have a potential for gain. They would rather lock in a sure profit and gamble against a probable loss even if the expected value of doing so is irrational. Trading is a probability game, each decision should be made on the basis of the best expected value and not what feels best.

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