Short

NDX/US30 - SHORT; SELL this extreme "rotation" in US equities!!

Di Nemo_Confidat

Aggiornato

Most likely a Crash.

Here is the Nasdaq100

from this post

Here is the DJIA

Nota

"In the latter stage of the bull market culminating in 1929, the public acquired a completely different attitude to the investment merits of common stocks. Why did the investing public turn its attention from dividends, from asset values, and from average earnings, to transfer it almost exclusively to the earnings trend, i.e. to the changes in earnings expected in the future? The answer was, first, that the record of the past were proving an undependable guide to investment; and, second, that the rewards of offered by the future had become irresistibly alluring.

Along with this idea as to what constituted the basis for common-stock selection emerged a companion theory that common stocks represented the most profitable and therefore the most desirable media for long-term investment. This gospel was based on a certain amount of research, showing that diversified lists of common stocks had regularly increased in value over stated intervals of time for many years past.

These statements sound innocent and plausible. Yet they concealed two theoretical weaknesses that could and did result in untold mischief. The first of these defects was that they abolished the fundamental distinctions between investment and speculation. The second was that they ignored the price of a stock in determining whether or not it was a desirable purchase.

The notion that the desirability of a common stock was entirely independent of its prices seems incredibly absurd. Yet the new-era theory led directly to this thesis. An alluring corollary of this principle was that making money in the stock market was now the easiest thing in the world. It was only necessary to buy ‘good’ stocks, regardless of price, and then to let nature take her upward course. The results of such a doctrine could not fail to be tragic.”

– Benjamin Graham and David L. Dodd, Security Analysis, 1934

Nota

Here is the Daily;

Nota

BTW, here are the Safe Haven trades, should the need arise;

The Best "Safe Haven" trade of 2021 (and beyond?)!!

Nota

Just a gentle reminder what happens after a "Generational Speculative Bubble" - like this current one - bursts;

Blue Chip Performance: 1973-1974

Du Pont -58.4%
Eastman Kodak -62.1%
Exxon -46.9%
Ford Motor -64.8%
General Electric -60.5%
General Motors -71.2%
Goodyear -63.0%
IBM -58.8%
McDonalds -72.4%
Mobil -59.8%
Motorola -54.3%
PepsiCo -67.0%
Philip Morris -50.3%
Polaroid -90.2%
Sears -66.2%
Sony -80.9%
Westinghouse -83.1%

... and this was after one of the "less celebrated bubbles" in market history!

One might also wish to peruse Goldman Sach's current Non-Profitable Technology Index;
hussmanfunds.com/wp-content/uploads/comment/mc210201c.jpg
... to induce a nose bleed, at will.

Nota

Furthermore, Margin debt – the amount of money that investors have borrowed in order to buy stocks – is now *** at the highest level in history, not only in absolute terms, but also relative to U.S. GDP! ***
hussmanfunds.com/wp-content/uploads/comment/mc210201p.png
All those "talking heads" advocating the opposite are either stupid, lying, or as is usually the case, both.

Nota

Not convinced, yet?!
Then how about that the ratio of U.S. total equity market capitalization to GDP, the present ratio being 2.63, is 337% above the historical norm! (Not the low but the norm!!)
... the norm, which is 0.78, being 70% below the current level.

Nota

The DJIA/Nikkei225 Spread;

US30/Nikkei225 - (Continuation) SHORT; SELL it until ...

Still The Best SHORT out there, bar none! - Despite the fact that the Nikkei is likely to run out of steam fairly soon, on the heels of a rally for the ages.
This can not bode well for US equities, at all.

Nota

This may come back up to fill the remaining Gaps then go into a dive, for good.

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Be careful!

The DJIA is approaching the Final Top, here.

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This is 1929 all over, again! Even the wording in the various media matches to a "T". (Read up on it.)

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Today (last trading day of Feb. 2021) the equity "rotation" got under way, indicating a very likely Nasdaq-led, final equity blow-off rally to set a permanent top on US (and Global) equities.
One may wish to front-run the suckers and buy it up, right here (Equity Indexes), with the strict plan of dumping it all on the very next, final turn - Global, Gernerational Equity Top. See this post;

How is it possible that the DJIA loses 90% of it's value? ...

Nota

The current Safe Havens and their "Risk On/Off" properties;

USDJPY <-> The World; Carry Trades, Safe Havens on the VIX Scale

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Obviously the Nasdaq is already leading the whole U.S. complex (indexes) lower.

Mot to mention a perfect "hit" then reversal

in this highly reliable indicator.
... from this post;

Just how bad is THIS Financial Crisis going to be??...

Nemo_Confidat

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