Let’s look at multiple MONTHLY charts. The objective of this session is to visualize assets and their current value.
Let’s start with the BURSTING of a NOTORIOUS BUBBLE – THE NKY IN 1989 – 1990.
A run-up of almost 500% was followed by decades of struggle.
How does the NKY compare to the SPX ?
What are the reasons for the run-up on both indexes? Quantitative Easing and Lose monetary conditions.
Let’s Isolate the SPX. It’s had a 500%+ run up. Similarly it has stayed overbought as per RSI indicators for multiple years.
What about the BOND MARKET ? What would happen if the MARKET decides to gives us negative yields ?
Some minor INDEXES are showing incredible price action. Technically speaking when WAVE 4 crosses WAVE 1 the trend breaks. This has MILES to correct before that happens, showing the index being SEVERELY expensive.
Finally BITCOIN, is this the FIRST ASSET to burst ???
And the DRIVER of all LIQUIDITY, the USD is showing signs of BOTTOMING …
We feel it is time to proceed with EXTREME CAUTION. We will remain SHORT TERM TACTICAL as these conditions could continue for quite some time, but the backdrop of capital markets is turning and we see DARK CLOUDS AHEAD.