For Wednesday, November 7, 2012, We Recommend Against Investing

Technical Comment:

The S&P 500 advanced 0.8% on volume higher than Tuesday but below the 30 day moving average.  The advance in the S&P 500 index was enough to reverse our stop loss trigger and return our forecast to a growth trend.  If the S&P 500 declines about 9 points on Wednesday (-0.6%) the stop loss algorithm could again be triggered and change our forecast back to an uncertain trend.

Subjective Comment:

The advance in US markets on growing but still light volume does not complete the formation of any predictive patterns, but there is a pattern forming.  There is still insufficient data to make a call regarding investing and we suggest ignoring our automatic forecast right now.  It still seems to be confused by the bouncing about of the stop loss trigger.

The Eurozone debt crisis is getting worse and so is the economic recession there.  Economic news from Europe will be bad for a while and likely cause Eurozone stocks to decline.  This could have spillover impact on US markets.  US markets are likely to react to the election results as well.  Continue to invest part of your portfolio in hedges against price inflation and stay away from all bonds.  The US stock markets are likely to start growing in the near future if the US money supply accelerates, so stay ready to invest.

Comments are closed.