World Stock Market Indexes
June 25, 2022: Stock market indexes are 99% the result of CENTRAL BANK actions and a HUGE BUBBLE.
| Our short-term BUY-SELL indicator - click to enlarge |
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The FED and ECB, the Bank of Japan, and the Swiss National Bank not only print money...they also BUY shares. Stock markets will continue to go up as long as MONEY is PRINTED and the additional marginal amount of freshly printed money has buying power left.
Goodbye to Overbought and welcome to Oversold!. Ever since the SPX hit a new all-time high above 3400 (08/28/2020), the message from Wall Street has been: overbought -- disregarding the old adage that “an overbought market could stay overbought much longer than your patience”. Overbought conditions occur when more than 75% of the New York-listed stocks are above their 10-week Moving Averages (statistics courtesy of Investors Intelligence). On November 17, 2020, as the SPX rose to a new all-time high of 3623 the indicator jumped to 84% and stayed at a high level until June 22nd when the SPX closed at 4246. From then on, the level kept declining to 38.3% as the SPX continued to rise to 4401 on July 27th. So, goodbye to Overbought, and welcome to Oversold!
When the money supply is growing faster than nominal GDP, then excess liquidity tends to flow into financial assets. However, if the money supply is growing more slowly than nominal GDP, then the real economy absorbs more available liquidity. That’s one reason why stocks go up so much when the economy is weak but the money supply is rising. At this time, with COVID-19 the Central Banks are creating money out of thin air in an exponential way and this will propel stock markets into Hyperinflationay heavens. High nominal stock markets however will not enable you to buy 3 EGGS. Only those who don't make their homework and fail to understand what is happening will keep chasing Fools Gold and will continue to invest in stocks.
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The VICIOUS part of these Bull Markets is that stock markets will continue to bubble when expressed in FIAT MONEY. Gold & Silver will perform better!... |
Dow Jones Industrials &SP500: Dangerous BUBBLES and Casinos.
| Dow Target & Support | Central Banks are buying shares... | Dow in Real Money | |
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Bullish Objective Dow |
38,200 |
 Bearish |
| Resistance |
35,800 |
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| Hard Support - Stop |
26,800 - 23,200 | ||
| Bearish Objective | 24,800 |
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| Technical pattern | Correction |
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The Dow to Geyser to 300,000 and higher...that is after this correction is over and we have QE4 & QE5 (Hyperinflation).
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| Short term candle |
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Long term candle |
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S&P 500 Large Cap Index: resumes uptrend. Dangerous Top formations!
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Bullish Objective | 4,800 - 5,200 |
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| Resistance | 4,800 | ||
| Support | 3,800 |
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| Bearish Objective | 3,200 |
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| SP500 Target & Support | Technical pattern | Correction |
SPX in Real Money is Bearish. |
Click to enlarge.
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| Short term Candle |
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WELCOME to ZIMBABWE - stocks are REAL ASSETS
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| Long term Candle | ||
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Click to enlarge.
Dow Jones Transportation index
| Dow Jones Transportation Index | |
| Bullish Objective | 16,200 |
| Resistance |
16,200 |
| Hard Support - Stop |
11,200 |
| Bearish Objective | 9,200 |
| Technical pattern | Correction |
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| Short candle | Chart comment |
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CENTRAL BANKS BUY SHARES...and print more money to buy more shares (Japan, Canada, Australia, FED, ECB)!
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| UK FTSE | Swiss SMI | German DAX | SA-Dow | Canada Dow |
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| Bull Trend | Bull Trend |
Don't buy currency risk. | ||
| Shanghai index | Japan |
Spanish IBEX | Austrian ATX | Belgium Dow |
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| Yen is VERY WEAK! |
expect wealth Tax. |
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| World Index | Australia | Portugal Dow | French CAC | Dutch AEX |
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| Russia | Brazil | Greece | ||
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Click here to see how BAD reality is when expressed in REAL MONEY |
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| Strong Ruble | ||||
The Footsie (British stock market index) is my Canary in the Mineshaft for the Dow Jones... and the index could be going for a winning run: breaking through the triple Top (with no mainstream attention). We now only have to wait until the breakout levels are positively tested. Once they are, I am sure the Dow Jones and stock markets, in general, will resume their climb of the Wall of Worry. See long-term charts for more important resistance levels
Uncertainty will grow over the coming months until the Hyper-inflationary depression sets in, and World Stock markets and interest rates start dancing to the tunes of the Zimbabwe scenario: rising Nominal Stock markets because of Quantitative Easing and Hyperinflation...but in the end, the Gold and Silver sector will perform a lot better. The stock markets of those countries (ex. Belgium, France) where more TAXATION is expected and those countries running into severe trouble (Greece, Italy, Portugal,...) will of course underperform. What is happening in South Africa (JSE) is an example of what is to be expected from other Stock Market indexes! [there are Capital controls in South Africa]
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Dow in Gold-CAUTION- BEARISH FLAG From now on Gold will continue to perform better than the Dow and Stocks!...mind the bearish wedge....it has been activated and means Stocks Markets will come down and the Gold & Silver sector will go up!  June 9, 2022: Expressed in Real Money The CRASH is resuming its bearish trend! Therefore it makes no longer sense to stay in Equities. ..They are safer than bonds, bank deposits, savings accounts, and cash...
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Belgium is a tertiary dangerous temporary safe haven for capital. It will remain so until Wealth and Capital gain taxes are enforced. This has become a reality in 2017. High time to move your marbles... Once capital controls are enforced, the stock market will behave in a similar pattern as the SA-Dow. |
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| The Footsie is a secondary escape route for capital leaving the European continent. Remember that London is a Tax Heaven and the city will continue to attract capital. Especially so after the Great Escape (BREXIT). The least we can expect is sidewards bullish action until Hyperinflation breaks out and the index soars to the upside...The same rule applies here as for the Dow Jones and the Nikkei: it's doesn't make sense to buy/hold shares when the currency comes down! |
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Stockcharts has discontinued the charts for the FOOTSIE...see our PF-chart
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| The Fiat Money BULLISH potential is 50% to 500% - use Trailing Stops and BUY during Corrections and Panic Situations! In summer 2017 we had a new all-time high in the S&P 500. We have a lot higher to go from here(after the correction). The next leg up will be broad-based among many sectors, and investors should begin to accumulate. Note that gold and stocks can both go up at the same time. Only the Gold miners will go up at a faster pace.
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The worst-case scenario and actual Target of the correction for the Dow is 14,200 & SPX target is 1520. The bullish targets are exponentially higher. We have extremely strong stock markets. AMAZING in times of recession. But a NORMAL consequence of Money Printing (QE). Markets will continue to go up as long as fresh money is created...and providing there are NO accidents.
| Be patient and use trailing stops - Use corrections to accumulate more common stocks, but don't exceed the proportions as shown in the Investment Pyramid. |
Designated EUROPEAN STOCK markets (see below) are possibly building a long-term bottom..others sit in a bull trend! The Chinese Stock and Japanese stock markets must be followed up closely...The Japanese Printing press is doing overtime and the freshly created fiat money is spilling into the Japanese stock market. But the Nikkei won't make up for the weak yen. [Japan's PM has vowed to double the money supply]. In November 2014, the Chinese Stock Market Index has broken out!
More QE or money printing for the EU, Japan, and the USA...Because we have communicating financial vessels (see Investment Pyramid) the freshly created capital will continue to seep into the stock markets. The more fiat money, the higher the markets! The best performing market is the Johannesburg Stock Exchange, Caracas (Venezuela), and the Iranese stock exchanges. Stock markets in the USA are poised to raise more....that is until the Printing Press stops...or we have an accident!
Capital fleeing RED Europe will push up north-American markets to record levels and the pressure of freshly created fiat money can be so big that the Dow Jones could well be flying to 300,000 and higher. Important is that certain European Markets are poised to keep sliding or (best case scenario) will move sidewards while bullish markets it will be for the North- American markets (the USA and Canada). It's readily apparent what effect the trillions and trillions of dollars, Yen's, and Pounds central banks have pumped into the system are having on shares. Add to this Capital which is increasingly fleeing Europe and buying American and vice versa. Basically, all stock markets should be crashing under the pressure of Deleveraging as a consequence of the financial problems the Western World is in, but Authorities are doing their best to avoid a crash in Stock Markets by pumping up Money Supply into Infinity.
| Currency controls: when Capital is not allowed to leave the country because of capital controls and investors stop trusting Authorities, STOCKS are often the best way to preserve savings. This is what we have in Zimbabwe and have in South Africa and Tehran (Iran). |
Do know that Authorities have an unlimited amount of Fiat money to play with and that there are over $ 1.4 quadrillion DERIVATIVES which can be used to scare fiat money out but also into Shares, Gold, Silver, and Commodities. (and options to buy it) or Treasuries. I assume that similar techniques can be used to keep the stock markets happy. However one may never forget that the ULTIMATE LOCATION where the authorities want your money is in WORTHLESS FIAT TREASURIES and FIAT MONEY (bank deposits, savings accounts. treasuries).
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In the 1930s and only 6 months after the BIG CRASH, the stock market had recovered half of its losses. (click on the thumbnail for the long term chart) Stocks are REAL ASSETS. During the Hyperinflation in Zimbabwe, stocks were used as money. 1932 we had a bottom for the London Stock Exchange. In less than 4 years or 1936, we had a new all-time high... |
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This is what the SP500 may look like over the coming years. I expect the index to continue to rise to new records UNTIL we have a serious correction or the Great Crash of the 21st century. |
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