Indexes Fail To Break Away From 200-Day MA

Hello traders everywhere. It's hard to believe but as I write two of the three indexes are in positive territory for the week. Mid-week it looked like the stock market may be in rebound mode, only to fall close to the levels that we saw last week at weeks end and ultimately unable to break away from the 200-day moving average. The indexes look to be set up to retest the low levels from last week, and that could form a double bottom, much like the one we saw in April of this year.

The 200-day MA has proven to be a strong level of support this year rejecting several attempts by the market to break it, only to see the market bounce higher after each attempt. Will that trend continue?

weekly trade triangle

As crazy as it might seem even with this week's volatility both the S&P 500 and DOW are looking to post weekly gains of +.2% and +.4% respectively. However, the NASDAQ isn't playing along, and it is posting its third weekly loss in a row standing at -.4%. Continue reading "Indexes Fail To Break Away From 200-Day MA"

Emerging Market ETFs Could Offer Great Opportunities

Recent studies of emerging markets show their investment opportunities may be greater than most investors realize. One study believes that by 2020 the aggregate GDP of emerging markets will overtake that of developed economies around the world. Another one has the number of global consumers hitting 1.8 billion by 2025, with the majority of them living in emerging markets. Lastly, it is believed consumer spending in emerging markets will grow three times faster than that of developed markets in the coming years.

All three of these stats indicate there could soon be a huge growth opportunity in developing markets around the world. But there are a lot of emerging market ETFs that are down more than 9% year-to-date while the SPDR S&P 500 ETF (SPY) is up more than 10% and hitting new all-time highs. With that being said, many experts are beginning to grow weary of U.S. equities as we have now set a new record regarding the length of our current bull-market and valuations appear to be stretched.

When we take all of this into consideration, moving money to emerging market funds now may turn out to be a good long-term asset allocation play. So, let's take a look at a few funds which look appealing due to their rough 2018.

The first two are the Vanguard FTSE Emerging Markets ETF (VWO) and its direct competitor the Schwab Emerging Markets Equity ETF (SCHE). Both of these funds are large, liquid and have low fee’s; 0.14% and 0.13% respectively. They also both don’t consider South Korea an emerging market but hold positions based in Hong Kong, Taiwan, India, China, South Africa, Brazil, Russia, and Mexico to name the top 8 countries based on holdings. Both have an index weighting based on market cap and have a weighted market cap of around $80 billion, meaning you’re getting great foreign large-cap exposure. Continue reading "Emerging Market ETFs Could Offer Great Opportunities"

World Oil Supply, Demand And Price Outlook, October 2018

The Energy Information Administration (EIA) released its Short-Term Energy Outlook for October, and it shows that OECD oil inventories likely bottomed in July at 2.806 billion barrels. It shows inventories rising in the third quarter, contrary to the normal seasonal trend. However, it forecasts that stocks will drop in December to 2.817 billion after the Iranian sanctions are expected to go into effect.

Throughout 2019, OECD inventories are generally expected to rise, ending the year with 98 million barrels more than at the end of 2018. The expected drop in Iranian production, due to the U.S. sanctions, is forecast to be more-than-offset by increases from other producers, such as the U.S., Canada and the Gulf states of Saudi Arabia, Kuwait and the UAE.

oil inventories

Crown Prince Mohammed bin Salman of Saudi Arabia has recently stated that KSA can produce at least 12 million barrels per day. If it does increase output to that level, this would be a major “surprise” to world markets since its production has never exceeded 11 million. Continue reading "World Oil Supply, Demand And Price Outlook, October 2018"

O, Canada! Huge Day For Cannabis Investors

O, Canada! What a historic moment for the cannabis industry!

Canada just became the first developed country in the world to legalize recreational cannabis.

Now that legalization has set billions of dollars in motion, Cannabis Stock Trades members are in a prime position.

We've been prepping our portfolios to capitalize on this giant day and it's finally here.

Cannabis stocks have a clear history of jumping higher before and after these key legalization dates.

Let's take a look at three recent examples.

1. Cannabis stocks soared when Colorado went legal on Jan 1, 2014.

On January 1, 2014, Colorado became the first US state to legalize recreational cannabis.

It was a breakout moment for the US cannabis industry – and it sent US cannabis stocks soaring. Continue reading "O, Canada! Huge Day For Cannabis Investors"

Gold & Silver: Fly or Die

The precious metals are busy finishing the anticipated pullback to the former support, which is almost within our grasp on the short-term charts. So, let it go and in the meantime we can look into the bigger charts with higher time frames to update the outlook beyond the short-term horizon.

Chart 1. Gold Monthly: 1122/1375

Gold Shines
Chart courtesy of tradingview.com

The monthly gold chart above answers some critical questions. The first one, why gold reversed ahead of $1000? The answer is the red horizontal line, which was set at the 2008 top and acted as strong support and breakdown of it would unleash severe volatility into the market as the next level of serious technical support is located in the $700 area (2006 top/2008 bottom). Continue reading "Gold & Silver: Fly or Die"