Gains Pains & Capital

Stocks exploded higher yesterday on announcements that the coronavirus pandemic appears to be slowing.

The rally has continued in the overnight session. The S&P 500 will be opening north of 2,700, well above a 38.2% retracement and closing in on a 50% retracement of its collapse.

This is certainly an exciting development, but unfortunately, we are not yet in the all clear as far as systemic problems for the financial markets.

The debt markets (also called credit markets) are larger and more sophisticated than the stock markets.

Indeed, credit picked up on the corona-collapse weeks before stocks did (red circle vs. blue circle in the chart below).

With that in mind, the credit markets continue to signal MAJOR problems exist in the financial system. High yield credit has failed to catch a bid and is in fact trending DOWN during the last week.

Bear in mind, these are JUNK bonds, so you’d expect a struggle during an economic downturn. Far more worrisome is the fact that high quality credit (meaning credit for companies that are allegedly well financed/less risky) is ALSO struggling.

This is particularly concerning when you consider that the Fed has announced it will be buying these bonds with an unlimited budget.

By way of comparison, consider what these credit instruments did during the late 2018-early 2019 “V” bottom which resulted in one of the best years for stocks in history. At that time, investment grade credit only struggled with resistance for a day or two before exploding higher (see the action below the red line in the chart below). And that the Fed WASN’T buying these bonds at that time either!

Again, the credit markets are signaling something BAD is happening “behind the scenes” in the financial system.

Stocks believe the worst is over, but credit tells us that is not yet the case. And credit is usually right.

On that note, if you’re worried about weathering a potential market crash, we’ve reopened our Stock Market Crash Survival Guide to the general public.

Within its 21 pages we outline which investments will perform best during a market meltdown as well as how to take out “Crash insurance” on your portfolio (these instruments returned TRIPLE digit gains during 2008).

Today is the last day this report will be available to the public.

To pick up your copy of this report, FREE, swing by:

http://phoenixcapitalmarketing.com/stockmarketcrash.html

Best RegardsParagraph

Graham Summers

Chief Market Strategist

Phoenix Capital Research

Stocks are up somewhat this morning.

This marks the second Monday stocks will open in the green (last Monday was a green open as well) following two horrifically bad weekend sessions that saw stocks open limit down or close to limit down (March 2^nd and 9^th).

In the simplest of terms, the panic in the markets appears to be abating. It is clear stocks have broken the downtrend from the panic (blue lines). What is not clear is whether this rally will continue or not.

Stocks stalled out under resistance (red line) last week. A break above that line would open the door to a run to 3,000.

At the end of the day, stocks are actually a minor player in this mess. The BIG story is what happens with the bond markets.

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An annual subscription to all of our current newsletters costs $1,500. 

But today, you can get a LIFETIME subscription to ALL of them, along with every new product we ever launch, for just $2,500.

Today is the last day this offer is available.

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Going into last week, it was clear the financial system was facing a debt crisis. Across the board everything from corporate bonds to municipal bonds were breaking down in a catastrophic fashion.

The Fed managed to stop this massacre by announcing it would backstop everything.  

The question now is whether that will be enough. Bonds have staged a major bounce in the last five days, but what happens if they turn down again?

Will the Fed’s announcement that it intends to buy corporate bonds be enough to stop the $10 trillion corporate bond bubble from imploding? 

What about the $16-$19 trillion commercial real estate market? Will the shutdown, which has closed so many restaurants and retailers, result in a crisis in this market as businesses begin skipping monthly payments or breaking contracts outright?

And what about the $23 trillion U.S. treasury bubble? Will the $2 trillion in stimulus, which both the President and the Democrats have suggested will be the first of several, be what finally pushes the U.S.’s debt loads into a crisis?

We don’t have answers to any of these questions yet.

The fact stocks have rallied 17% makes investors feel better about things, but it doesn’t do anything to address the larger systemic issues facing the markets today.

Indeed, the only thing of which we CAN be certain is that the Powers That Be are going to address ALL of these issues by printing money.

And that is going to induce higher inflation.

Note that Gold has broken out against the $USD, the Japanese Yen, and the Euro.

This is telling us that the first round of the crisis, the deflationary collapse, will be ending. But the second round, the INFLATIONARY tidal wave, is only just beginning.

On that note, we just published a Special Investment Report concerning FIVE secret investments you can use to make inflation pay you as it rips through the financial system in the months ahead

The report is titled Survive the Inflationary Storm. And it explains in very simply terms how to make inflation PAY YOU.

We are making just 99 copies available to the public.

To pick up yours, swing by:

https://www.phoenixcapitalmarketing.com/inflationstorm.html

Best Regards

Graham Summers

Chief Market Strategist

Phoenix Capital Research

Stocks are red this morning.

If you’ve been following my work this week, you shouldn’t be surprised. History tells us that after sharp, severe crashes such as the one from late February to this week, there is usually a sharp two-day bounce.

As Bill King recently noted, throughout history there are two only two other instances in which stocks crashed this rapidly. Those are the crash of 1929 and the crash of 1987.

Both of them featured a swift double-digit decline of over 20% in a matter of days.

Both of them featured a MASSIVE two-day rally that saw stocks rise 20%.

Both of them then saw stocks roll over to either retest the lows (1987) or fall to new lows (1929).

The crash of 1929 saw stocks lose 34% in the span of a few days before staging a massive two-day rally of 18%. Stocks then dropped to new lows.

The crash of 1987 saw stocks fall 22% in a single day. They then staged a massive two-day rally of nearly 20% before falling to retest the lows.

———————————————————–

Get a LIFETIME Subscription to All Of Our Products For Just $2,500 

An annual subscription to all of our current newsletters costs $1,500.

But today, you can get a LIFETIME subscription to ALL of them, along with every new product we ever launch, for just $2,500.

Today is the last day this offer is available.

To lock in one of the remaining slots…

CLICK HERE NOW!!! 

———————————————————–

The point is that this week’s massive bounce doesn’t mean the lows are in. We are still in watch and wait mode for the markets. It would be perfectly normal to retest the lows or even break to new nominal lows.

Having said that, the credit markets, which lead stocks have shown signs of improvement,

High yield credit spreads haven broken above resistance (red line). What happens here is key. If they move to close the gap then the rally has legs. If they don’t we’re dropping

The same is true for investment grade credit spreads.

One thing that gives me concern is the fact that industrial metals companies, which are closely aligned with the real economy, all began to roll over yesterday.

I continue to believe stocks will retest the lows and possibly even break to new lows. 

In light of this, we’ve reopened our Stock Market Crash Survival Guide to the general public.

Within its 21 pages we outline which investments will perform best during a market meltdown as well as how to take out “Crash insurance” on your portfolio (these instruments returned TRIPLE digit gains during 2008).

We made 100 copies available to the public.

As I write this there are 39 left.

To pick up your copy of this report, FREE, swing by:

http://phoenixcapitalmarketing.com/stockmarketcrash.html

Best Regards

Graham Summers

Chief Market Strategist

Phoenix Capital Research

Stocks are red this morning.

If you’ve been following my work this week, you shouldn’t be surprised. History tells us that after sharp, severe crashes such as the one from late February to this week, there is usually a sharp two-day bounce.

As Bill King recently noted, throughout history there are two only two other instances in which stocks crashed this rapidly. Those are the crash of 1929 and the crash of 1987.

Both of them featured a swift double-digit decline of over 20% in a matter of days.

Both of them featured a MASSIVE two-day rally that saw stocks rise 20%.

Both of them then saw stocks roll over to either retest the lows (1987) or fall to new lows (1929).

The crash of 1929 saw stocks lose 34% in the span of a few days before staging a massive two-day rally of 18%. Stocks then dropped to new lows.

The crash of 1987 saw stocks fall 22% in a single day. They then staged a massive two-day rally of nearly 20% before falling to retest the lows.

———————————————————–

Get a LIFETIME Subscription to All Of Our Products For Just $2,500 

An annual subscription to all of our current newsletters costs $1,500.

But today, you can get a LIFETIME subscription to ALL of them, along with every new product we ever launch, for just $2,500.

Today is the last day this offer is available.

To lock in one of the remaining slots…

CLICK HERE NOW!!! 

———————————————————–

The point is that this week’s massive bounce doesn’t mean the lows are in. We are still in watch and wait mode for the markets. It would be perfectly normal to retest the lows or even break to new nominal lows.

Having said that, the credit markets, which lead stocks have shown signs of improvement,

High yield credit spreads haven broken above resistance (red line). What happens here is key. If they move to close the gap then the rally has legs. If they don’t we’re dropping

The same is true for investment grade credit spreads.

One thing that gives me concern is the fact that industrial metals companies, which are closely aligned with the real economy, all began to roll over yesterday.

I continue to believe stocks will retest the lows and possibly even break to new lows. 

In light of this, we’ve reopened our Stock Market Crash Survival Guide to the general public.

Within its 21 pages we outline which investments will perform best during a market meltdown as well as how to take out “Crash insurance” on your portfolio (these instruments returned TRIPLE digit gains during 2008).

We made 100 copies available to the public.

As I write this there are 39 left.

To pick up your copy of this report, FREE, swing by:

http://phoenixcapitalmarketing.com/stockmarketcrash.html

Best Regards

Graham Summers

Chief Market Strategist

Phoenix Capital Research

Stocks are red this morning.

If you’ve been following my work this week, you shouldn’t be surprised. History tells us that after sharp, severe crashes such as the one from late February to this week, there is usually a sharp two-day bounce.

As Bill King recently noted, throughout history there are two only two other instances in which stocks crashed this rapidly. Those are the crash of 1929 and the crash of 1987.

Both of them featured a swift double-digit decline of over 20% in a matter of days.

Both of them featured a MASSIVE two-day rally that saw stocks rise 20%.

Both of them then saw stocks roll over to either retest the lows (1987) or fall to new lows (1929).

The crash of 1929 saw stocks lose 34% in the span of a few days before staging a massive two-day rally of 18%. Stocks then dropped to new lows.

The crash of 1987 saw stocks fall 22% in a single day. They then staged a massive two-day rally of nearly 20% before falling to retest the lows.

———————————————————–

Get a LIFETIME Subscription to All Of Our Products For Just $2,500 

An annual subscription to all of our current newsletters costs $1,500. 

But today, you can get a LIFETIME subscription to ALL of them, along with every new product we ever launch, for just $2,500.

Today is the last day this offer is available.

To lock in one of the remaining slots…

CLICK HERE NOW!!! 

———————————————————–

The point is that this week’s massive bounce doesn’t mean the lows are in. We are still in watch and wait mode for the markets. It would be perfectly normal to retest the lows or even break to new nominal lows.

Having said that, the credit markets, which lead stocks have shown signs of improvement,

High yield credit spreads haven broken above resistance (red line). What happens here is key. If they move to close the gap then the rally has legs. If they don’t we’re dropping

The same is true for investment grade credit spreads.

One thing that gives me concern is the fact that industrial metals companies, which are closely aligned with the real economy, all began to roll over yesterday.

I continue to believe stocks will retest the lows and possibly even break to new lows. 

In light of this, we’ve reopened our Stock Market Crash Survival Guide to the general public.

Within its 21 pages we outline which investments will perform best during a market meltdown as well as how to take out “Crash insurance” on your portfolio (these instruments returned TRIPLE digit gains during 2008).

We made 100 copies available to the public.

As I write this there are 39 left.

To pick up your copy of this report, FREE, swing by:

http://phoenixcapitalmarketing.com/stockmarketcrash.html

Best Regards

Graham Summers

Chief Market Strategist

Phoenix Capital Research