Wednesday, Jun 15: The current market forecast is for a decline

We recommend investing in any leveraged ETF that grows when the US market declines.

Here are some options:

Inverse 2x Leverage

NASDAQ 100

Russell 2000

S&P 500

QID

 

SDS

 

 

 

Inverse 3x Leverage

NASDAQ 100

Russell 2000

S&P 500

SQQQ

SRTY

SPXU

Today’s shift of the computer algorithm to “decline” is a rare and significant opportunity!  In the past 48 years of S&P 500 market data, the pattern that has developed over the past two weeks has only occurred 46 times.  While that’s an average of once per year, this “decline” pattern actually appears in clusters.  The last cluster occurred with 3 signals on 6/17/2008, 9/15/2008 and 2/25/2009.  It has been 2.3 years since a “decline” pattern last happened.  While the last cluster preceded a large crash in the market, our current forecast makes no prediction of how far the market will decline in the coming days and weeks.  We are only predicting that it will decline further from here.

Our official recommendation is to invest in leveraged ETFs that grow when the US market declines.  This is the technical signal of our forecasting algorithm, and it is supported by the following subjective assessment:

The Federal Reserve has signaled their intention to stop purchasing US Treasury Bonds at the end of this month.  This will conclude the purchase of about $110 Billion per month since last November.  The removal of this incredible amount of liquidity from the market after the tremendous monetary inflation since late 2008 suggests a significant decline in asset prices.  This is consistent with the Business Cycle Theory from Austrian Economics.

If you do not feel secure investing in Inverse ETFs, at least consider moving your investments to a cash position ASAP to avoid the pending decline.

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