|EDITOR’S NOTE: I release the full notes of my Capital Wave Forecast to Money Zone subscribers every Monday morning. To get first access to these full notes and learn how to get “in the Zone”, go here.|
Markets took a little breather last week, not making all-time highs, which is actually a good thing.
After all, individual stocks don’t go up in a straight line nor do markets. If they do, there’s a chance there will be a reckoning of some equal measure.
The Dow ended the week at 27,875.62, down .5%. The S&P 500 closed at 3110.29, off .3%. And the Nasdaq Composite ended the week down a scant .2% at 8519.88.
What surprised a lot of analysts and talking heads is that we didn’t see more selling as Beijing sounded off against the U.S. Senate for passing its Hong Kong Human Rights and Democracy Act, which was reconciled with the House’s version of the bill and readied for President Trump to either sign or veto.
What the Media Wants to Paint the Markets at Your Peril
Markets have been sensitive, at least superficially, to almost any “breaking news” having to do with the U.S. and China trade war. With Congress pressing hard on mainland China by pushing to legalize Hong Kong’s need to demonstrate its brand of “British-Chinese-esque” democracy isn’t interfered with, meaning it’s not going to be trampled on by Beijing, it wouldn’t surprise anyone if markets saw meaningful profit-taking.
But looking past the “superficial” up and down moves, markets have been making on good news and bad news, on signs that trade war negotiations are progressing, on hopes of a phase one deal, on threats of more tariffs or China not following through on earlier agreements. The headline-making news blurbs that push markets higher and lower don’t matter in the big picture.
Here’s the big picture. If anyone steps back from the media hype and naysayers knocking the economy and rallying markets and looks at any chart of U.S. equity benchmarks, they’ll see a beautifully ascending channel in which stocks are heading higher.
That’s the big picture now and it’s not likely to change radically any time soon.
To see specific trade strategies for this week’s market, Money Zone subscribers can read on here.
The Market Picture Gets Clearer Everyday
About the big picture, there’s more to it than breaking through resistance and graphs showing up trending stocks.
The true colors that make up the big picture aren’t obvious to most people.
Thankfully they are to us.
In tomorrow’s Wall Street Insights & Indictments you’ll find out exactly what I mean.
You don’t want to miss it, because I’m going to strip off the yellow varnish of the big picture and show you where stocks are really going.