TradePlacer.com - Gold, Silver, Wine Trading

Login

Password
Forgot Password?
 
  These Indicators Suggest We Could Be On the Precipice Of A Major Move to the Downside  
  Lorimer Wilson on 2017-11-16 18:18:21.0
 
 

As the next crisis erupts, the mainstream media is going to respond withstockcrash-2 shock and horror but the only real surprise is that this ridiculous bubble lasted for as long as it did. The truth is that a market decline is way overdue. Below are several indications why that is the case.

The original article, written by Michael Snyder, is presented here by munKNEE.com - " The internet's most unique site for financial articles! (Here's why)" - in an edited ([ ]) and revised (…) format to provide a fast & easy read. Visit our Facebook page for all the latest - and best - financial articles!

Every time we have seen a ?leadership reversal?, a ?Hindenburg Omen? and a ?Titanic Syndrome signal? all appear simultaneously there has been a market crash. The downward trend that has been developing over the past week appears to be accelerating. Just take a look at this chart. Could we be right on the precipice of a major move to the downside?

These three readings haven't occurred simultaneously since 2007, when the financial crisis was getting underway. It happened before that in 1999, right before the dot-com crash. That's not very welcome company…You can see the other times in recent decades when these three signals have appeared simultaneously on this chart right here. Once again, past patterns do not guarantee that the same thing will happen in the future, but if the market does crash it should not surprise anyone.

If you are not familiar with a ?Hindenburg Omen? or ?the Titanic Syndrome?, two bearish market-breadth readings, or what constitutes a ?leadership reversal?, here are their definitions:

  • Hindenburg Omen: A sell signal that occurs when NYSE new highs and new lows each exceed 2.8% of advances plus declines on the same day. On Tuesday, they totaled more than 3%.
  • Titanic Syndrome: A sell signal triggered when NYSE 52-week lows outnumber 52-week highs within seven days of an all-time high in equities. Stocks most recently hit a record on November 8.
  • Leadership reversal: When companies setting new 52-week lows climb above the number hitting new highs.

Central Bank Support Ending

10 days ago, I published an article entitled ?The Federal Reserve Has Just Given Financial Markets The Greatest Sell Signal In Modern American History? in which I pointed out that this stock market bubble was created by unprecedented central bank intervention, and now global central banks are reversing the process that created the bubble in unison. There is no possible way that stock prices can stay at these absolutely absurd levels without central bank help, and if global central banks stay on the sidelines a market decline would seem to be virtually inevitable. What the fundamentals have been telling us is that, in the absence of central bank support, we should see the markets start to decline, and that it is quite likely that a painful recession is on the horizon.

Yield Curve Flattening

Meanwhile, we are also witnessing a very alarming flattening of the yield curve between the 2-year yield and the 10-year Treasury yield, which have been moving closer together. The curve dipped to 68 basis points Tuesday, a 10-year low. Hogan said 70 has become a line in the sand, and when it falls below that traders get nervous. A flattening curve can signal that the curve will invert, which historically means a recession is on the horizon. If the yield curve does end up inverting, that will be a major red flag.

Conclusion

As the next crisis erupts, the mainstream media is going to respond with shock and horror but the only real surprise is that this ridiculous bubble lasted for as long as it did. The truth is that a market decline is way overdue.

Scroll to very bottom of page & add your comments on this article. We want to share what you have to say!

If you want more articles like the one above sign up in the top right hand corner of this page and receive our FREE bi-weekly newsletter (see sample here).

Related Articles from the munKNEE Vault:

1. U.S. Stock Market Has Entered the Final Stage of a Super-Charged Tulip Mania

The U.S. stock market has entered into the last stage, which I call the Super-Charged Tulip Mania. Not only are stock prices inflated well above anything we have ever seen before, but valuations are also reaching heights that are totally unsustainable. This next market crash will not resemble anything similar to what took place during the 2008-2009 U.S. banking and housing market collapse. When the markets cracked in 2008, EVERYTHING went down together. Instead this time around, as the markets tank the precious metals will surge to new highs.

2. Stock Market: ?A Day Of Reckoning Is Coming? Say These Insiders

Right now most people seem to have been lulled into a false sense of security, and they truly believe that everything is going to be okay but every time before when the market has looked like this, a crash has always followed, and this time will be no exception.

3. Harry Dent: Mark My Words: ?The Bubble May Well Be Peaking!?

Mark my words here: This third and final bubble (fourth if you count 1987) is now the biggest and most obvious bubble in this boom since 1983. It is as overvalued as at the top of 1929 and the fact that no one wants to hear about it is an ominous sign that it may well be peaking!

4. Get Ready To Experience A 2008-Like Crash ? Here's Why

Treasury Secretary, ex-Goldman Sachs banker Steven Mnuchin, has threatened Congress with [a] stock crash if Congress doesn't pass a tax reform Bill. His reason is that the stock market surge since the election was based on the hopes of a big tax cut. This reminds me of 2008.

5. A Stock Market Correction ? Not A Crash ? Is Most Likely ? Here's Why

If the markets crash in 2018 then, like previous crashes, they will prove to be a buying opportunity but, until the masses embrace this bull market, however, the most likely outcome is a correction and not crash.

6. Stock Market Overvalued ? Expect a 60% Decline From Here

John Hussman believes the markets are so overvalued now that we can expect a 60% decline from here…[and in his original article he] presents a total of seven charts to make a compelling case.

7. Martin Armstrong: ?The Stock Market IS NOT In A Crash Mode ? Yet.? Here's Why

All we have been hearing since 2011 is how the stock market is going to crash but these charts illustrate that the retail market is not in crash mode just yet and it is still nowhere near the overbought levels of 2007.

8. Bull Market Won't End Until Late 2018 At the Earliest ? Here's Why

There's no real reason to suspect from a fundamental standpoint that the bull market in the stock market has ended. Indeed, the balance of the data suggests we aren't likely to see a recession in the U.S. until late 2018 at the earliest. Let me explain further.

9. Everything Is In Place For A Serious Stock Market Correction ? But When?

As it stands, everything is in place for a serious stock market correction; the question is when. With markets in record territory and momentum strong, the next crash may not be around the corner but, with valuations getting further and further out of whack, stocks will have further to fall when a crash comes.

10. Enjoy the Melt-up Because This, Too, Will Come To An End

There has been nothing that has been normal about this economic recovery, and I don't think there's going to be anything that's normal on how this all ends. For now, enjoy the melt-up, because this too will come to an end.

11. This Autumn Will Be One Of Market Turmoil & Shock ? Here's Why

I do realise that bearers of bad news are unpopular figures. If they are right, nobody will thank them and many people will blame them. If they are wrong they will be ridiculed but, as most readers know, I am not here to be a prophet of doom and gloom. No, my purpose is just to tell things as I see them and to warn people about the massive risks that the world is now facing.

12. What the Economic & Financial Tea Leaves Are Saying

My reading of the economic and financial tea leaves is that the economy continues to grow at a sub-par pace (about 2%), just as it has for the past 8 years. I don't see evidence of a coming boom, or of an imminent bust… just more of the same. Dull. Here are a baker's dozen charts, with the latest updates, to flesh out the story:

13. Is U.S. Financial Judgment Day Coming Due This Fall?

Watch what emerges in the coming months and ask yourself if the DAY OF FINANCIAL JUDGMENT is here! I am.

14. Those Responsible For the Bubble Roiling Through the Financial World Having Second Thoughts

This article discusses how we arrived here; what's next; what this means for the stock market; and China as the key to the problem.

15. YOU HAVE BEEN WARNED: The Situation In the Markets Is Much Worse Than You Realize!

I honestly believe that those who read this article in full will understand the horrible predicament we are facing better than 99% of the population!

The post These Indicators Suggest We Could Be On the Precipice Of A Major Move to the Downside appeared first on munKNEE dot.com.
 
 
Market Categories Search Symbol Trade Register Other Links FAQ Blog Editorials Charts Contact Us Terms Bookmark and Share Site Meter