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Monday, January 5, 2015

Stock Market Crash 2015 Warning

With the oil dropping another 4% on monday and the euro down against the dollar, we have a situation similar to kids standing on a beach whereupon suddenly the water rushes out towards the sea leaving a sea bed full of sand and starfish. 
Those that don't know what is happening think, oh, thats strange. Lets walk around on the seabed floor and pick up starfish.
Those that do know whats happening grab thier kids and start running right before the Tsunami alarms start going off. 
The economy is sick and its now showing that we just went past the point of no return. Gas is now in the 1.85 per gallon region. This shows that the world economy is drastically slowing down, and there is not enough demaind in China and Europe for oil. How is this possible?
The economy starts to get a bit of kilter so people cut back and stop spending money on manufactured goods, instead they hoard cash. Then the manufacturing sector starts to slow down and they lay off workers and they don't need as much oil to run thier industry. This starts to back up and suddenly the world demand for oil starts to fall. OPEC sees this and decides to use this as an opportunity to clear out its competition, ie pumps in europe, US, fracking, off coast drilling. OPEC does this by not dropping thier production of oil, they are cranking out as much oil as they have been. Suddenly the price of oil starts to drop like a rock because of supply and demand. This global weakness then shines a light on the weak global economy and the recently strengthened dollar which everyone knows is backed on nothing and being propped up artificially by the US and to some extent, the Chinese because we owe them so much money.
All the signs are there and everything is lined up for a crash. The QQQ weekly is even pointing toward a crash:

You can see that the RSI sine waves are getting smaller and smaller as well as the RSI indicator on top is showing a progressive slowdown. Everything, the oil, the world economy the indicators are showing that there is a crash coming. A lot of billionares are also dumping US stocks.

How To Play This: Now is not the time to be in anything long. I dont know what you are going to do about your 401k, but if you have any personal money in the market now is the time to sideline it. If im  wrong, and I dont think there is a way I am wrong, you will just miss out on some profit. But if I am right, you will avoid a crash like in 2000 or 2008.
'The Sky is Falling' or "The British is Coming' is not a popular thing to say or post on the internet. If you look at CNN or marketwatch.com you will see some warnings but then they attempt to tamp it down with a 'however...' with a counterpoint by some other expert. Remember, they were doing this as well in late 1999 with the Nasdaq at 5000. The talking heads were beaming from ear to ear seeing no real end in sight with only the occational rumblings from someone like me.
Think of the mainstream media like a populist carnival barker. They will tell you only what you want to hear and the only time they will start screaming is when the Tsunami wave is already crashing in.

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