Riding The Gravy Train: Market Update

Riding The Gravy Train

Beating the market is fun and profitable. This is how we do it.

Saturday, February 16, 2013

Market Update


It continues to look as though a material top is forming, and typically the longer it takes the harder the subsequent fall.  Below is a chart that shows that the 13-day average between highs and lows is matching the lows of the past few decades.

Normally after this happens there is either a massive rally or decline in the stock market.  It's tough to imagine a massive rally at this stage.

 
 
The next chart shows margin debt at extreme highs.  Typically this precedes a big drop in equities.
 



Anecdotally, economic indicators appear to be decaying globally.  For one such anecdote, consider "Wal-Mart has said sales this month have been a “total disaster”, according to leaked internal emails."




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