Stock Market Road Map 2018

Page 1

THE

TIME

FACTOR

2018 US Equities Road Map Your guide to US equities throughout 2018 according to WD Gann

JAN . 2018 1


Very important information – please read this first

The objective The WD Gann 2018 Road Map has been calculated based off the teachings described in volumes 1 and 2 of Trading with the Time Factor. In particular, we apply the methodologies described in chapter 14 of volume 2 of the course to derive our forecast for the year ahead.

Not personal or general advice The 2018 Road Map is an education tool only. It should not be construed in any way as personal or general advice. I am not a licenced financial adviser, nor do I know your individual financial circumstances. The contents of The 2018 Road Map are strictly educational material only and provides an analysis on how the techniques described in Trading with the Time Factor can be applied to analyse the US equity markets. It is not intended to encourage you to take a trade in a particular market or deal in a financial product. If you are looking for financial advice, please consult someone who is appropriately qualified to do so.

Contents are strictly confidential The contents of the 2018 Road Map are strictly confidential and for your own use and perusal. They must not be disseminated, shared or reproduced in any way without my prior written consent. I have spent hours upon hours researching and refining the concepts taught and described in Trading with the Time Factor, and a number of hours have gone into applying those techniques to develop the 2018 Road Map which you see now and which has been created especially for you.

The value of any investment and the income derived from it can go down as well as up. Please, never investment any more than you can afford to lose.

Past performance is no guarantee of future performance Just because a trading system or trading methodology has produced returns in the past, does not necessarily mean that it will replicate those returns in the future. Trading is a dynamic speculation and can produce losses as well as profits. Past performance is no guarantee of future performance and therefore should never be relied upon as such.

No guarantee of financial returns The 2018 Road Map is not advising you on how to implement a particular investment strategy or how to invest in your chosen market. That is a decision strictly for you to make and for you to enjoy the full reward of any returns that you create.

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This information is current as at Jan 2018

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01 Introducing the Time Factor Road Map for 2018

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Introduction

Objective of the Road Map

Keep it simple

The objective of the Time Factor Road Map is to give you a basis of analysis to assist you with a guide on the overall direction of the US equities market.

I use my Road Maps as a template to guide my investment decisions over the course of the calendar year.

It is not intended to pin point the exact dates and prices that the market needs to follow throughout the course of the year, but rather it is designed to guide you on the directional bias the market should follow in the 12 months ahead. I have been producing these Road Maps regularly since November 2011 and they have generally served me well. During that time, the output of my work was reserved only to my closest friends and family whom I have helped benefit over the journey. In 2016, I published my first annual Road Map to the wider public. That year, US stock prices tracked the Road Map at an almost identical pace to my predictive price model. In 2017, I had an equally successful year, with prices once again following the Road Map almost identically right up until 9 October 2017 where the market deviated from the Road map only for a matter of 18 calendar days.

It would be arrogant of me (and quite frankly, extremely foolish) if I was to expect the market to follow my Road Map precisely for the entire 365 days of the year. The Road Map is not designed to work that way. Not even WD Gann himself could get them to work that accurately. It is therefore of upmost importance to realise that the market will have deviations from the Road Map, even if the forecast is working in a particular year. Whenever I see a deviation from the market, then I watch the market more cautiously – that is where my price and time techniques come into play. These are the PRICE and TIME techniques I share in the Trading with the Time Factor (eBook) series.

When I’m not right Typically, when I construct these Road Maps each year, I am able to come up with a forecast price curve that I feel pretty confident about.

But sometimes the market has other plans. In these situations, I will often recalibrate the forecast and determine which major TIME cycle is in control of the market. There are times too when the Road Map is working perfectly, but my pricing assumptions need to be recalibrated. This is because the Road Map uses historical stock market cycles that have spanned over one hundred years, and back then nominal stock market prices were much lower than what we have today. In the ‘Roaring Twenties’ for example, one of the greatest bull market runs ever, the Dow Jones traded from a low of 40 to a high of 386. Compare that to the price of 25,000 today and you will see why it is absolutely necessary to correctly calibrate (and potentially recalibrate) your pricing to suit the current market. Unfortunately, I haven’t seen a trading software package that can calibrate these cycles properly and that is why I continue to do these calculations through my Microsoft Excel spreadsheets.

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The best way to use the Road Map

How to use the Road Map

Dow Jones index v the key signals given by the 2017 Road Map

If there is one simple way to use the Road Map, then that is to let it identify the 3 or 4 key buying or selling periods in the year ahead (see, right). It is that simple. The Road Map will give you a guide as to WHEN you should be buying and WHEN you should be selling (give or take a week or so). SELL 9 Oct

Last year, our Road Map identified late March / early April as the best buying period for the year. Then a rally into 8 August as a period to sell. If you recall, it was August 8 when Donald Trump and Kim Jong Un commenced their feud around nuclear war and this caused jitters in the market.

SELL 8 Aug

BUY early-mid Nov

I had then forecast that the 9-10th of October was going to be a significant top, but this never eventuated. Finally, I identified that a major low on the 10-11th of November will provide a significant buying opportunity. The actual low came in on November 15 and the Dow Jones has rallied over 10.0% in the space of eight weeks ever since.

BUY early April

So, with that said, let’s get into 2018‌ www.thetimefactor.com

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In case you hadn’t noticed, we are in a bull market

Looking back to see forward In order to properly understand the way forward it is always important to understand the past. The chart right is a Master Road Map chart of the Dow Jones Index which I created back on 7 November 2011. I will never forget the date, because it was exactly one week after the birth of my first born child – who incidentally, was born on my birthday (or according to her, I was born on her birthday!). Since then, this Master Road Map has guided me and has been the basis of my long term investment decisions ever since, and I have actually constructed this Master Road Map to go out all the way to 31 December 2021 as my long term guide. And so, I stick to another simple rule: whilst the market continues to follow the Road Map I too will continue to follow the Road Map. And for the last seven years, that’s exactly what I’ve done. Now, it doesn’t take a stable genius to realise that if you were being guided by this Road Map for the last seven years, you would know that we have been in a major BULL MARKET. And I don’t know about you, but I like to be long when we are in a bull market.

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So how have we tracked?

The bull is only 6 years old The chart (right) is the same as the previous Master Road Map chart shown earlier, albeit I have now overlaid what the Dow Jones has actually done compared to the forecast. As you can see, the Dow Jones has pretty closely tracked the Master Road Map – certainly directionally – over the last seven years. I have heard so many market commentators out there talk about how the length of this bull market is far bigger than any others and that we are due for a correction very soon. But those same commentators have been saying that same message for the last two years now, and as you can see (right), it has been the last two years where all the gains have been made! So, when I construct my Master Road Map, I always view it in the context of asking myself this one simple question: “If I need to make only one investment decision over the next 5 years am I a buyer or a seller?”. The Master Road Map has therefore made me a buyer since 19 October 2011. And this has worked out well.

2yr gain +50.1%

6yr gain +147.8%

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But when did this bull market really begin?

Hint: it’s not when you think

Dow Jones Industrial Average – weekly chart

The entire world talks about this bull market that has raged on now for almost 9 years, but that incorrectly assumes that this TIME CYCLE started back in March 2009. Sure, there is no denying that the bottom of the stock market occurred at that time, but for all the WD Gann enthusiasts out there who have been wondering why their time calculations have been off, it is because you have probably been measuring your cycles from the wrong base. In my view, October 2011 marks the beginning of this economic cycle and it should be the basis for assessing the length and duration of this bull market. With that said, by my simple calcs, that makes us 6 years and 3 months into this bull market, not the 8 years and 10 months that everyone else would like to make you believe. When you compare this to the duration of previous MAJOR bull markets, there is still time left in the tank on this one.

4 Oct 2011 6 Mar 2009

We will come back to this a little later‌

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Revisiting the record books

It didn’t feel like a bull My forecast that a significant bull market in global equities would commence in October 2011 is not something I have conjured up with hindsight. Those of you with Trading with the Time Factor – volume 1 (pp.69-70) will know that I had an article published in financial journals on 19 October 2011 on behalf of the investment bank I was working for at the time. The article outlined my bullishness on stocks and why I thought it was a good time to buy. I acknowledge completely that the Dow Jones bottomed out at 6500 in March 2009, but I can tell you from first hand experience working in a deal making area at an investment bank, that institutional investors globally did not think we were in the stages of a bull market or a market recovery. Quite the contrary. In fact, negative sentiment did not begin to turn itself around until sometime in 2012 after the European Debt Crisis (which was continuing to intensify throughout 2010 and 2011) finally began to dissipate.

started, but it also reflected that we were still in the throes of a market littered with negative sentiment which continued up until that point in time. The long term interest rate of the major European countries is evidence of that fact (see, right). The higher the level of interest rates (or yields) the greater the level of risk that was being perceived by the market. As you can see, this market risk peaked on or around October 2011.

I haven’t been a bear in years So where does this current market compare to ones which we have seen previously? To examine this properly, I think it is vitally important to look at previous bull markets in US equities to help us put into perspective where we are in the current cycle and how long this current cycle can potentially be.

October 2011 therefore not only marks the point in TIME when the recovery

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02 A comparison of previous market cycles relevant for today

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A trip down memory lane

Gold rush

Dow Jones Industrial Average (monthly chart) – the 1842 BULL MARKET

We begin this history lesson by going back all the way to 1842, when the United States economy began its recovery following the Panic of 1837 – a financial crisis in the US that sparked a major economic recession that lasted until the mid-1840s. Pessimism at the time abounded, with the ensuing panic deriving from both domestic and foreign origins. Speculative lending practices saw significant declines in cotton prices and a resulting land bubble price collapse. Banks suspended the redemption of commercial paper at face value (ie loan defaults). Unemployment is reported to have been as high as 25% in some locales, and the period of depression saw years of deflation in wages and prices. When the recovery came (and which was intensified by the California gold rush in 1848), the US stock market (see chart, right) had an expansion that endured for almost 11 years. By my calculations, to meet that same duration, this bull market would need to run out to Sep 2022 (or at the very least Feb 2020 for those following the Mar 2009 low).

131 months

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A trip down memory lane (cont‌)

The Panic of 1884

Dow Jones Industrial Average (monthly chart) – the 1884 BULL MARKET

Another boom and bust cycle involving the yellow metal, and the Panic of 1884 is notarised following the depletion of gold reserves in Europe and the US Treasury Department putting the brakes on investment in the United States resulting in numerous banks calling in their loans. It was another era where speculation in the financial markets abounded, yet the recovery which ran up right to the Great Panic of 1893, was a bull market in US equities that endured for a period of time spanning 98 months (or just over 8 years). When projected forward from our Oct 2011 cycle low, this repeating time frame would take us to December 2019 as a length of time where we could reasonably expect this current bull market to continue.

98 months

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A trip down memory lane (cont…)

The Roaring 20’s

Dow Jones Industrial Average (monthly chart) – the 1929 BULL MARKET

Arguably the greatest bull market in stocks of all-time, the 1920’s bull saw prices run from a stock market low in 1921 to the breathtaking high on 3 Sep 1929.

8yr gain +469.3%

It was a bull market that endured for 95 months (sound familiar?), and a move that catapulted US stock prices by almost 500%. In the context of speculative bubbles, this one probably takes the cake (although Bitcoin is doing its best to challenge it), and demonstrates what a stock market bubble looks like. With this current stock market bull up only 270% from the low (if measuring from the Mar 2009 low), then our current bull has potentially got a lot more to run. Once again, the bull market in the 1920’s was one which endured for almost 8 years. Notably, it wasn’t until the final 12 to 24 months of the bull cycle where all the price action and rapid increases happened. We are far from that occurring almost 90 years later in 2018.

95 months

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A trip down memory lane (cont…)

The 1950’s and 60’s

Dow Jones Industrial Average (monthly chart) – the 1960s BULL MARKET

We fast forward through time, and in no particular order I find myself reviewing the 1950’s bull campaign, a run that commenced in the early stages of 1958 and continued all the way until 1966 (or even arguably until the December 1968 double top).

8yr gain +125.2%

Once again we saw the bull market endure for a period of 96 months (wait, … did I already say that?) with stock prices more than doubling from their lows. In comparison to other bull markets, the price magnitude of the 1950’s and 1960’s was mild. What is significant however is the length of TIME that stock prices continued to run higher.

96 months

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A trip down memory lane (cont…)

And last, but not least

Dow Jones Industrial Average (monthly chart) – the .dot com BULL MARKET

For my final trip down memory lane I take us back only 20 years ago to the dot.com high which occurred at the turn of this century.

9yr gain +370.7%

For many of you, this should take you back to a period of living memory. Certainly for me, it doesn’t feel very long ago that technology mania had captured the minds and attention of the investment world. Now, whilst I think this cycle low actually began in August 1982, if I was to conservatively use Oct 1990 as my starting point, then the length of this bull market endured for a period of 110 months (more than 9 years), producing a staggering increase in US equity prices of over 370% from the low. If we were to apply that same logic to the Mar 2009 low, then it takes us out to May 2018 and a Dow Jones price of over 30,000. Taking it from the Oct 2011 low, and once again we see ourselves moving into the TIME window between 20202021. For this cycle to repeat, we would need to see a Dow Jones price in excess of 40,000 to achieve the same heights of only 20 years ago.

110 months

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Dow Jones 35,000? this is what a bull market top looks like

Just a thought Based on my analysis of the cycles, it is not inconceivable to me that we see a print of 35,000 or higher on the Dow Jones before we see the “big crash” that the doomsayers have been wrongly calling for over the last several years. Please do not mistake the chart (right) as the projection of my Master Road Map out to 2021 – that is something I am simply not prepared to share with others at this stage. But what it does highlight is a trajectory that the current equity market could take, which would simply put it on par with a number of the previous bull market cycles we have seen in the past. (In fact, previous bull market cycles would see the Dow Jones go higher). The overall point I am trying to make, is that had you spent the last several years waiting for the “crash” to happen, you have missed out on the massive gains. The current trend is up. Even a fifth grader could tell you that. Do not attempt to buck the trend until the market gives you the signal to do so. This means a lower top and a lower bottom – it really is that simple.

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03 Revisiting our previous Road Map forecasts

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How to put these Road Maps together

Refer to the major cycles

It doesn’t work that way

Believe it or not, but there is actually a science into properly constructing these Road Map charts.

Doing it that way simply won’t give you the right results. At least not consistently.

Whilst it is not my objective to explain the detail behind that science in this report, it is important to understand that in order to correctly develop a Road Map curve, you need to use the correct cycles that have occurred in the past.

That is because there are some cycles using the Gann ‘Decennial Pattern’ which are not relevant to the current cycle influencing the market. If it was that easy, then everyone would be doing it that way.

I discuss the basis for how to identify these MAJOR TIME CYCLES in Chapter 14 of my Trading with the Time Factor course (volume 2).

The other important feature to realise is that different markets work to different cycles and therefore require different calculations of TIME.

Granted, the Time Factor course is designed as a practical way of analysing the markets and therefore makes some simplifications to assist you in determining the major trends – ie whether we are at the beginning or the ending of a bull market. And I cannot emphasise enough that it is trading these big swings where the most (and the easiest) money is made.

As an example, the major cycles which influences the US equity markets are not the same as the cycles which influence Australian stocks or gold.

But putting together an accurate Road Map is not as simple as going back every 10 years and aggregating that information into a chart.

But certain cycles will influence the same markets in similar ways.

Only until you properly understand these cycles can you then begin to forecast correctly.

Time Factor Report subscribers Subscribers to my monthly Time Factor Report in 2018 will be privy to my analysis of these cycles. As part of that service over the first six months of 2018, I plan to identify these MAJOR cycles and describe where they are derived from and which cycles influence certain markets. For now however, it is important to realise that these forecast curves are not a simplification of aggregating the 10, 20 and 30 year cycles, but rather there are a series of much more complex calculations behind it. So, let us continue…

The best example I can give is that, based on my research over the years, the MAJOR CYCLE which influences the United States economy also influences the Wheat and Soybeans market. However it is a different cycle altogether which dominates the Australian market and a different one again that dominates gold. www.thetimefactor.com

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The Time Factor – 2016 Road Map

Road Map – 2016 The very first of my published Road Maps back in 2016 shows a generally bullish market characterised by sideways trading through the middle part of the year before a strong finish. And this is pretty much exactly what happened. When I first published the Road Map in early January 2016, we had seen the worst January start to the US stock in history. Despite that, my bold prediction was for the Dow Jones to test the level of 20,000 during the year (it was trading around 16,500 at the time), and my Road Map calculations predicted an end to the year of 19,842. History will show that the Dow Jones closed the year at 19,763. As you can see (right), my Road Map forecast tracked the actual US equity market very, very closely throughout the course of that year. I haven’t seen another published forecast as accurate as this one was for 2016.

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The Time Factor Road Map 2017 (re-cap)

Road Map – 2017

Trading notes (2017)

Trading notes (2017)

The Road Map in 2017 again proved extremely useful in keeping us invested with the overall bull market trend.

Overall, we should see a strong market in US equities throughout the course of 2017.

A copy of my Trading Notes (right) which I published and provided to clients, outlines in the very first paragraph that “overall, we should see a strong market in US equities throughout the course of 2017.”

Whilst it is possible that trading in the calendar year starts off subdued, I would also not be surprised for US equity markets to put on 5% or so in the early part of the year leading into mid February.

I strongly encourage you to review the MASTER TIME CYCLES described in chapter 14 of Trading with the Time Factor – volume 2, outlining why the August to October 2017 period is such a crucial time for US equity markets.

In that Report, I also went on the record for saying: “The key lesson [from 1987] was not the money that could have been made ‘shorting’ the market in October, but the money that could have been made trading the market long into that top. It is my sense, that this will be the theme again in 2017 – many market pundits will be calling “the top” prematurely and missing out on the gains as we ride higher.” Even my forecast for volatility and a sell-off in October (which I am happy to admit was wrong) was written in the context of “a potential area to enter long positions”. In other words, 2017 was earmarked as a year where the best money was going to be made by being long and riding the trend higher, and not by being a bear in a bull market.

After that point, it is quite possible that markets could consolidated and trade in a sideways pattern before commencing a new bull run following the termination of the early April period. You will need to watch for key turning points in January to help you determine when the key date for April is likely to produce a significant buying opportunity. Markets from that point onward should generally be bullish until we approach the middle of July heading into early August. The date 8 August needs to be watched as a date which may produce volatility and the time period between 23rd – 27th of August must be observed for a potential change in trend.

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The key trading to Time dates producing turning points in June and July must be observed for producing potential turning points in October. Watch the 90 and 120 degree time frames working back from October. Volatility in the market may very well commence by mid-July, but I would expect this volatility to be heightened in October, most likely with some form of panic selling occurring around this time. Any dramatic sell off should be viewed as a potential area to enter long positions, and setting yourself up for the projected movements which we anticipate to occur in 2018. A major low on or around the 10th-11th of November should be watched, but again, you will need to be guided by the turning points which occur during May and August 2017 to help you determine the exact date. 20


The Time Factor Road Map 2017 (re-cap)

Precision to a point in time As I tracked the Road Map in 2017, I was often scratching my head and telling myself that “it can’t be this easy”. By 9 Oct 2017, the Dow Jones had not only tracked my Road Map almost to perfection, but had essentially closed at the exact price level nominated in my calculations (see chart, right). There is no escaping from the fact that when this date came, I had been expecting a meaningful market correction. In fact, I had written about this TIME CYCLE when I first wrote Trading with the Time Factor back in January 2014. We all know that the market had a different idea – and that is what I love about the market. It will always prove you wrong when you are 100% sure that you are right! Therefore between the period of 9 October and 27 October, the US stock market followed the beat of its own drum, and left the Road Map forecast behind. As the next chart will clearly show…

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The Time Factor Road Map 2017 (re-cap)

Eighteen days out of 365 It only took the Dow Jones a total of 18 calendar days to make a mockery of my 2017 Road Map, as the US equity market continued to power onward and upward into new record highs. Despite it being completely on song for the previous 281 days, in October we witnessed a significant deviation from the Road Map ‘trend’. To the uninitiated, this may have rendered the Road Map completely useless, but for the astute Gann observer, the Road Map was still in play. As the next chart shows…

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The Time Factor Road Map 2017 (re-cap)

Recalibrated The chart (right) shows my recalibration of the Road Map to adjust for the period between 9 Oct and 27 Oct where the US market continued to run higher than projected. Essentially what this recalibration does, is “reset” the market back to position on the Road Map curve, allowing you to follow current prices against the Road Map trend. You will notice from the chart (right), that following 27 Oct, the US equity markets essentially followed the same directional course and magnitude in price which had been forecast by the Road Map curve.

“reset”

In other words, the buying period we had expected in November in my 2017 Trading Notes, occurred just as we expected, and by recalibrating the chart, we can see this visually on the recalibrated Road Map curve (right). But that was then, and this is now. So where to from here?

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04 And now… the Road Map. Twenty Eighteen.

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This could be one of the most difficult years yet

A long time between drinks I am going to preface my discussion leading into the 2018 Road Map by saying this has been the toughest Road Map chart that I have put together since 2011. There are a number of reasons as to why I say this, but predominantly I have yet been able to identify with absolute confidence the key cycle which I expect to dominate the markets over the next 12 months. Until I am able to see which shape the market takes (which we should know by the end of March 2017), the US equity markets this year is likely to take one of two courses of action. The first is a continuation of the bullish tone. A resumption of trend and a strong finish to the year. A scenario where we see the Dow Jones test the 30,000 barrier late into the year. The second scenario is one of a more subdued market. A market where the Dow Jones will essentially end the year where it started, however a market that will provide tremendous trading opportunities and big moves throughout the year.

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Scenario 1

The bull continues Under this scenario if you were to sum up the analysis in a simple few words it would be: “Go long and stay long the market.” This scenario envisages a US equity market that finishes the year much stronger than where it started. A year where bucking the bull trend will see you bruised and battered. A significant low point in the market around the end of February or early March, followed by a rally that should last between 45 or 60 days into 14 April or 8 May. The June equinox may present another low point in the market, however under this scenario I expect the middle parts of the trading year to produce volatility and sideways action that will chop a number of ‘buy and hold’ traders out of the market.

mid Apr

early May

early Oct 21-24 Jun

late Feb – early Mar

Another solid low point does not appear on the cards until early October after which point the year should finish strongly. Under this scenario, the US equity markets will be setting themselves up for a massive blow off top in Q3 of 2019. www.thetimefactor.com

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Scenario 2

The bull on sedatives The alternate scenario still follows an overall bullish year, but with a more sedated outlook.

19 Oct

This scenario is earmarked by selling pressure occurring in early February before a market low is produced in late March / early April.

mid May

A strong rally into mid-May will mean that late Mar / early Apr provides the best buying opportunity for the year. Weakness should then set in during the middle part of the year through to early August and cause a tough time for passive investors. The date of the low in August will most likely be related to the turning point in February, with both being 180 degrees apart. Another swift rally from 21 Sep through to the middle of Oct would then occur, with a weak end to the year. Quite the contrast to the scenario one Road Map presented earlier.

21 Sep start Aug start Feb

late Mar – early Apr

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So which is it?

And what does this mean?

Dow Jones Industrial Average (weekly chart)

Whilst this year’s report will sound like I am providing myself with a two way bet, it always pays to go back and look at where we are in the broader context of the overall market. Right now, we are in a bull market that is being characterised by a series of higher tops and higher bottoms (illustrated, right). In a market like this it is wiser to remain invested in the trend rather than to swim against the tide. And so once again, I am not on the look out to initiate a short trade but to remain invested with the trend until my indicators tell me otherwise – that means a lower low and a lower high formation. At the back of my mind is the ability for this market to go into a run away mode and the worst thing to do will be to sit on the sidelines and miss out on the ride. Under either scenario, the middle of May looks like a period where hedging the portfolio might serve you well and the month of September and October should generally produce higher prices.

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Concluding thoughts

Trump 2.0 So rather than sit on the fence, I am going out on a limb here and am putting my confidence in the former scenario, one which involves a bullish year and a strong finish by the US stock market. The fundamental backdrop of low interest rates, considerable amounts of uninvested capital sitting on the sidelines and cuts to US corporate tax rates are all stimulatory factors which should underpin stronger equity prices. I am looking out for a year that should provide a buying opportunity toward the latter half of the first quarter with a four to six week rally into the middle of May. A sideways chop throughout the middle of the year will cause heartburn for a number of the ‘buy and hold’ investors sitting in the market. This will not be a market where a simple ‘set and forget’ strategy will reward you handsomely like in years gone by, and 2018 will be the year where the weaker (and less educated) hands in the market get flushed out of a number of their long positions in specific stocks. Stock selection in 2018 will be more important this year than it has been in the previous seven years and investors

may seek more comfort in listed ETFs that provide a diversified exposure to the market rather than specific stock selections which rely on the general momentum of the market to carry them higher. To be clear however, this is the first time since October 2011 where I have not been supremely bullish on the markets. The end of this stock market cycle is approaching (Q3 2019), and when it arrives volatility will increase and the moves both up and down will become stronger and sharper in magnitude. In light of that, when we put this current bull market into context with bull cycles which have preceded it, the potential for the tremendous rise in stock prices to continue certainly remains. In this scenario, it is a market where you do not want to be on the sidelines. In short, I am not a bear (yet), I am still a bull. But I am not the brazen bull that I have been over the last seven years either. My plan is to keep an exposure to a rising stock market and to carefully pick and choose my positions over the course of the year.

Until next time…

This year will be a traders market. It won’t be for the pretenders. www.thetimefactor.com

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for more information:

info@thetimefactor.com www.thetimefactor.com

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