Why You Should Be VERY Careful With Stocks Here (the VIX Manipulation Scheme)

I want to warn you to be very VERY careful with stocks right now.

The common narrative is that the US is entering a golden age in its economy and that this growth will drive stocks ever higher.

The reality is that GDP growth has collapsed. The third quarter of last year (3Q16) was the quarter everyone thought signaled a new beginning with growth of 3.5%. However, the very next quarter’s growth (4Q16) collapsed to 1.9%.

And thus far this quarter 1Q17 is tracking at 1.8%

Put simply, growth is NOT coming soon if at all. Even Trump’s top economic advisor has admitted that GDP growth of 3% is unlikely until the end of 2018.

So what is causing stocks to rally so hard?

Well the truth is that that rally is being driven by just a few names. Currently, the number of S&P 500 companies trading above their 50-day moving averages is rolling over and falling.

sc

However, the much larger concern is the daily market fixes that are occurring. These fixes are using a type of investment fund to game the market. And it is clear manipulation.

The funds are called “risk” parity funds. And they use the Volatility index or VIX as a buy or sell signal for stock purchases.

Put simply, if the VIX is rising, these funds pull out of stocks. If the VIX is falling, these funds buy stocks.

Here’s how the scam works.

Whenever stocks roll over, which should force the VIX to rise, someone slams the VIX lower. This FORCES risk parity funds to buy stocks, ramping the market higher.

I can tell you point blank that this scam is occurring numerous times throughout the day. I’ve literally watched these VIX slams take place to force the stock market higher on days in which stocks should be weakening and the VIX rising.

Why is this dangerous?

Because this is not REAL market buying being driven by investors who want to own stocks. This is automated buying being forced by manipulation.

The whole thing is VERY reminiscent of what took place in the build up to the 1987 crash.

While I’m not saying that we’ll have another 1987 Crash, I AM saying that stocks could crater 8% or more in a matter of days (or hours) similar to the 2010 Flash Crash.

sc-1

So be VERY careful buying into the notion that this bull market rally is the real deal. It’s not. It’s market gaming being driven by manipulation. And there’s no need to chase it.

This concludes this article, if you’re looking for more investment insights we offer a FREE daily investment briefing called GAINS PAINS & CAPITAL.

Those who sign up today will receive three Special Reports (35 pages of premium content) outlining a variety of investment strategies you can use to generate real wealth the markets.

To find out more… visit.

http://phoenixcapitalmarketing.com/evergreen3reports.html

Best Regards
Graham Summers

Chief Market Strategist

Phoenix Capital Research

Disclaimer: The information contained on this website is for marketing purposes only. Nothing contained in this website is intended to be, nor shall it be construed as, investment advice by Phoenix Capital Research or any of its affiliates, nor is it to be relied upon in making any investment or other decision. Neither the information nor any opinion expressed on this website constitutes and offer to buy or sell any security or instrument or participate in any particular trading strategy. The information in the newsletter is not a complete description of the securities, markets or developments discussed. Information and opinions regarding individual securities do not mean that a security is recommended or suitable for a particular investor. Prior to making any investment decision, you are advised to consult with your broker, investment advisor or other appropriate tax or financial professional to determine the suitability of any investment. 

Opinions and estimates expressed on this website constitute Phoenix Capital Research's judgment as of the date appearing on the opinion or estimate and are subject to change without notice. This information may not reflect events occurring after the date or time of publication. Phoenix Capital Research is not obligated to continue to offer information or opinions regarding any security, instrument or service. 

Information has been obtained from sources considered reliable, but its accuracy and completeness are not guaranteed. Phoenix Capital Research and its officers, directors, employees, agents and/or affiliates may have executed, or may in the future execute, transactions in any of the securities or derivatives of any securities discussed on this email. 

Past performance is not necessarily a guide to future performance and is no guarantee of future results. Securities products are not FDIC insured, are not guaranteed by any bank and involve investment risk, including possible loss of entire value. Phoenix Capital Research, OmniSans Publishing LLC and Graham Summers shall not be responsible or have any liability for investment decisions based upon, or the results obtained from, the information provided. 

Phoenix Capital Research is not responsible for the content of other websites or emails to which this one may be linked and reserves the right to remove such links. OmniSans Publishing LLC and the Phoenix Capital Research Logo are registered trademarks of Phoenix Capital Research. Phoenix Capital Management, Inc.
What Happens When the Everything Bubble Bursts?
  • By trying to corner the bond market (risk-free rate)
  • the Fed has created a bubble in everything
  • We call this THE EVERYTHING BUBBLE
  • Reserve your copy of our Executive Summary
  • To prepare for what's coming down the pike!
Your contact information will never be rented or sold to anyone EVER.