The meaning of Greek elections for financial markets

Welcome back in my website.

One of the main fact of the last week consists of the victory of anti-austerity party led by Alexis Tspiras in Greece.

 

It seemed that this victory could have a negative effect both in the stock and in the bond market in Europe and then all around the world, with a domino effect.

This thing has not happened.

 

Look at the 5-day chart below. It consists of an etf whose ticker is GREEK. It deals with Greek stocks.

Observe its volumes… there is no panic selling and there are good buy volumes in some bottoms.

 

 

GREEK etf

 

 

Therefore, this is an avoided danger for financial markets in this moment. The meaning of Greek elections is that there is no problem about them yet and that stability continues.

My real fear is the behavior of my forecasts that keep on showing an uptrend until the month of February and then an imminent selloff.

Here are my updated charts of the stock indices that I keep under control in this website.

 

S&P 500 stock index forecast updated on 23th of January 2015

 

S&P 500 stock index forecast updated on 23th of January 2015

 

S&P 500 stock index forecast updated on 23th of January 2015

 

Sensex stock index forecast updated on 23th of January 2015

 

For this reason, I have bought some stocks recently and I think to hold them until February. Then, if an important distribution pattern takes place, I will sell them.

Let us wait to see what will happen.

EQR is the stock that I have suggested freely to buy to all my followers in the American stock market, for instance.

 

There is another question that is very important now, respect Greek election outcome:

“How can the devaluation of Euro respect USD affect American economic growth?”

A revaluation of USD can reduce American export and this can reduce the value of American listed companies. This simple fact could sustain the hypothesis of the selloff of my forecasts, that rea only made based on graphics.

This is the real question now.

 

Besides this, do not forget that the S&P 500 is at its 5-year top and a great decline is very likely.

I mean that there are many facts to lead to confusion and to an uncertainty of behavior.

 

As I am a trend follower, I do not want to anticipate too much, what happens, but I want to react when a new trend starts. The stock market will tell us what we can do, simply.

Then, I will suggest the correct stocks to buy.

Stock market and financial markets are an ever-modifying creature, in general. I need to follow them constantly to understand where they are likely to go. This is the difficulty of this business.

Therefore, we will discover together where the next great trend to follow is.

I think that that’s all for this week.

Do not forget to share this post with your friends in social media. They will be happy. You can find all the buttons here below.

Kind regards,

Fredrick

 

The best trading strategy

Welcome back in my website.

I would like to show you that a new 3-month cycle has probably just started in the S&P 500.

Look at the image below.

 

S&P 500 stock index updated on 16th of January 2015

 

As you can see in the DAV indicator, there are new signals of new accumulation.

The moving average that indicates the 15-day cycle has crossed over the blue line that indicates a 30-day cycle. This implies that either a new 3-month cycle has just started or it is ready to start.

These graphic suggests me that the forecast of this index is substantially correct.

Look at it below.

 

S&P 500 stock index forecast updated on 16th of January 2015

 

The question is: “How the FED can influence the behavior of the stock market?”

If I consider the following graphic about monetary mass M1, I can see a delay of about 1 month between the printing of new money and the corresponding uptrend in the S&P 500.

Therefore, as a lot of money was printed in December, I expect a good run-up in January 2015 in the stock market.

I think that this is a simple concept. The more money you borrow, the great money you (great banks) can invest.

If you have followed me, you know that I sent a buy signal for the stock EQR via email last week to my followers.

I am used to explain what is very likely to happen in the stock market in my website and I give buy and sell signals accordingly via email to my follower at least once per month.

I am used to offer few good buy signals to my paid members in my private membership area.

Someone can say: “Your website is not like either Barchart or Kiplinger and so on.”

When I enter those websites, I have a lot of information but also, a lot of confusion. I mean that I cannot understand what I have to do after I have read them from a practical point of view.

When I established my website, my aim was very simple.

I wanted a website that was able to keep under control the behavior of the main indices and that was intended to offer few medium term buy signal for very good stocks with a low risk every month.

I wanted stocks with great potential performance and a low risk. I did not want to be a frequent trader. This is not the way good things are made in.

I remember an interesting statement by Jesse Livermore, a well-known speculator in the last century:

 

“After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: it never was my thinking that made the big money for me. It was always my sitting. Got that? My sitting tight!”

 

He was use to catch only the best stocks and to keep them until the end of their trend. Period.

I consider it the best trading strategy.

I am used to do the same for each 3-month and 6-month cycle. This is my style of trading.

I think that if there is a secret in trading stocks, this is one of the best-kept secrets.

For this reason, I continue to control the behavior of the stock indices and when a new cycle starts (a new uptrend), I want to buy the strongest stocks. This is my trading philosophy.

When a good chance happens, I suggest buying a stock. There is no need to write an entire article about that. It is obvious that you have to buy the strongest stocks, just to give an example.

“Buy the stock XXX today with a stop loss of X%”. This is an example of buy order of mine.

“Keep it simple”. This is my preferred statement.

Therefore, I will give an advice to my followers about what stocks to buy each month. I will give and advice to my members in the area reserved to them as soon as something very interesting and with low risk happens.

Let us return to the analysis of stock indices.

As regards the other forecasts here they are.

 

Nasdaq stock index forecast updated on 16th of January 2015

 

Sensex stock index forecast updated on 16th of January 2015

 

Italian stock index forecast updated on 16th of January 2015

 

They explain to us that a new trend has started or it is about to start.

The problem lies in how central banks will behave in the new few months.

I consider the red line that I have drawn in these carts, the most important trading instrument.

If this line is broken down, it means that the six- month cycle has turned down and trading short is preferable. Until that line is not broken down, I will trade long.

I think that that’s all for this week.

Do not forget to share this post with your friends in social media. They will be happy. You can find all the buttons here below.

Kind regards,

Fredrick

 

The current distribution continues in the stock market

 

Welcome back in my website.

As I have said in the last few weeks, the current distribution continues in the stock market.

You can see the following graphic of the NASDAQ stock market as an example.

 

Nasdaq stock index updated on 9th of January 2015

 

I have used a famous instrument of Larry Williams to measure the accumulation – distribution phase (supply and demand).

I have improved it, I have fit it to a 30-day cycle length and here is the result.

I can see that the more this index grows, the higher the divergence of this indicator is respect the values of the same index.

Therefore, supply overcomes demand at this level of the index.

Then the correct question is: “Is the forecast of this index coherent with this indicator by Larry Williams?”

Let us look at it.

 

Nasdaq stock index forecast updated on 9th of January 2015

 

If you observe, you can see lower tops expected in the right side of this graphic. This is the demonstration of a lower interest in the stock market in this moment. If any negative economic fact happens in United States in the next few weeks, the shown downtrend will take place. We have some little clues in this moment.

I want that these clues turn into a trustful test.

All the other indices behave in a similar way. Here are their graphics.

 

S&P 500 stock index forecast updated on 9th of January 2015

 

 

S&P 500 stock index forecast updated on 9th of January 2015

 

 

Therefore, I will select the best etfs to trade this new phase when a new trend will start.

I am not willing to trade long stocks if a new downtrend starts.

However as I am a trend follower trader, I have to remember you what it does mean to be a trend follower trader. This is more important than the ability to create good market forecasts.

If you are a “trend follower” trader, you have to act in this way:

– you need to see a new trend that takes place. You have not to center its starting bottom;

– you need to follow a new trend: you have not to anticipate it. There is no need to anticipate anything. If the underlying fundamentals of any stock or of any index do not change, a new trend will never start. Let the new trend to tell you that something important has changed in fundamentals.

 

It is a simple concept but it is far from banal.

Ed Seykota is used to say that: “Simple doesn’t mean unsophisticated”.

I prefer to trade in this way. I do not want to anticipate anything. I want that current data and not forecasted data to confirm my point of view. Then I open my new trade.

I hope that you can understand what I mean deeply. Reflect on what I have just written, because it is the essence of trend following and of a wise low-risk trading.

Therefore, if the current behavior of these indices is a distribution phase, they are not far from to show a new starting trend.

 

Italian stock index forecast updated on 9th of January 2015

 

I think that that’s all for this week.

Do not forget to share this post with your friends in social media. They will be happy. You can find all the buttons here below.

Kind regards,

Fredrick

 

  • Fredrick

    Fredrick

    Welcome into Mystocktobuy website.

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  • Federico, l have to say that it's very unusual to come across someone that is as open and honest as you are.
    You openly show all your calls including the loses. Such honesty should be rewarded.
    I will continue to follow you and thank you so much for your time and efforts.

    Angela P. (UK)

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    Dear Fredrick you are a very serious and reliable person.
    You have always given to me pieces of advice and information that have revealed very valid.
    What distinguishes you is the seriousness and the love that you use in doing all this.
    Thank you.

    Azzurra Z. (IT)

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    I just happened upon your site in the last few days and am satisfied with your attempt to communicate. I will continue to follow until I see a noticeable lack of "something" like sound advice, logical remarks and well put sentences. Should I notice what I feel are these and other short comings, I will attempt to email you at this address and share my concerns. I know you want to be a success at this and I support your endeavors. Be patient. Asking us for input today, that's a good idea.

    Ben W.

    /////////////////////////////////////////////////

    Hello Fredrick,
    I happened to bump into your blog and i must tell you that i'm glad i have. I'm an aspiring trader whom wants to develop a trading method like you have since i dont have the time to daytrade....
    I would appreaciated it if you can give me further explanation and i was also wondering if your willing to take me as your apprentice to teach a good strategy like the one you've acquired. I have experience position trading but i need a good foundation like you have. ...
    Thanks in advanced,

    Harley D.

    /////////////////////////////////////////////////

    Hi Fredrick
    First of all I wanted to thank you for your analysis on the Italian market and the Nasdaq.
    I found your suggestions very helpful and I followed all the signals of the newsletter with great results.
    ...
    Best regards

    Domenico S. (IT)

    /////////////////////////////////////////////////

    Hello Fredrick, some time has passed and I wanted to write to you to thank you warmly for your weekly counseling about markets.
    I want also to congratulate with you for your forecasts that are always accurate and detailed. My regret is that I have not always followed you.
    While I am saying bye to you, I want to espress my best wishes to you for the great work you are used to do in your website.

    Bye and thanks again.

    Andrea Z.

    /////////////////////////////////////////////////

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