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Created on: 2/2/2020 2:23:53 PM Last Update: 2/2/2020 7:37:53 PM Posted by: RTT
WARNING: This entry is 506 days old. It may contain broken links, out-dated or misleading content. Please read on with caution.
1 POST
Dow Jones Utility index could trade like the FANGs
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 The world is changing because the US FED is considering capping the US 10 yr interest rate under the US inflation rate, or negative real interest rates forever. Further massive destruction of the US dollar purchasing power.
Previous Post: Formula for when the great stock market rally ends
In the previous post this blog said:
When valuations for the boring water company or the boring electric company is trading like your Facebook, Apple, Amazon or Netflix or Google (ie FANG) you know something is wrong.
This is when a seriously over valued market is screaming at you.
Of course the reader must understand in a world where money printing goes super nuts (Zimbabwe style) the stock market may go hyper inflationary and picking a time frame for a top is never a good idea, but we are not there yet. There is no Ben Bernanke helicopter money to the masses yet (ie MMT).
We may be there, 'helicopter money lite'. If the intention is to cap interest rates under inflation, this is a form of massive easy money (or easy debt).
Of course the effect of negative real interest rates is the US 10 yr is now broken because it does not protect you from inflation, this is interest rates suppression, or fake. The US FED has enacted this policy before, during WW2, are we in WW3? No. Yet the debt levels as a percentage of GDP suggest we are. Crazy.
This means investors will hunt for a UST 10 yr alternative, hence utility stocks with their high dividends will attract a lot more investor interest. Yes a water company may go to a P/E of 40.
This means demand for quality utility stocks around the world will be strong, and if the US dollar falls, utility stock in other parts of the world will be attractive.
A good place to hunt for Wyckoff, cycles and Gann angles.
Long term channels
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Close up of the above chart.
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Of course nothing moves in a straight line, corrections of 10% to 20% along the way are likely.
Changes in the world is the source of all market moves, to catch and ride the change we believe a combination
of Gann Angles,
Cycles,
Wyckoff and
Ney logic
is the best way to ride the change, after all these methods have been used successfully for 70+ years.
This post is a delayed and small sample of what is avaliable to members. Sign up to enjoy the full service.
NOTE: readtheticker.com does allow users to load objects and text on charts, however some annotations are by a free third party image tool named Paint.net
Investing Quote...
..“The desire for constant action irrespective of underlying conditions is responsible for many losses on Wall Street, even among the professionals, who feel that they must take home some money every day, as though they were working for regular wages.”..
Jesse Livermore
.."Money can't buy you happiness but it does bring you a more pleasant form of misery"..
Spike Milligan
.."Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected"..
George Soros
.."The first rule is not to lose. The second rule is not to forget the first rule"
Warren Buffett
.....“I measure what's going on, and I adapt to it. I try to get my ego out of the way. The market is smarter than I am so I bend.”..
Martin Zweig
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We at readtheticker.com hold the view that a mix of stock chart technical analysis, Richard Wyckoff, William Gann and Jim Hurst methods plus market fundamentals allows the investor to formulate a very sound market opinion. These attributes are mutually inclusive and must be weighted equally before investing or trading in any Stock, ETF, Currency, Bond, Commodity, CFD or Mutual Fund
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