A few weeks ago, we noted that stocks looked to be posting a false breakout.
A false breakout occurs when the market breaks out of a technical formation in one direction then fails to follow through on the move. Looking at the rising wedge pattern in the S&P 500 this appears to be happening now:
As you can see, stocks broke out of the rising wedge to the upside. However, this move looks to be rapidly losing steam. We’ve just seen a new lower high. And if the S&P 500 were to fall back below its upper trendline LOOK OUT: failed breakouts tend to resolve both quickly and violently.
Indeed if you look at stocks relative to Copper, there’s room for a REALLY bad correction here:
We’ve noted for some time that stocks had diverged sharply from the underlying economy. But this is a truly ugly chart. And if stocks ever begin to re-connect… it’s going to be BAD.
Investors, take note… the financial system is sending us major warnings…
If you are not already preparing for a potential market collapse, now is the time to be doing so.
I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.
As I write this, all of them are SOARING. In fact we just locked in four straight gains of 8%, 12%, 21% and 28% in the last month ALONE.
Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!
We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…
To join us…
Best Regards,
Graham Summers
