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Is the American Real-Estate Industry Set to Boom in 2022

If you are someone that is heavily involved in the world of real estate, then you will know that the last year or so has been a little touch and go. Due to the unfortunate world events that have unfolded over the last year,  almost every aspect of our daily lives has been affected.   The way in which America thrives in terms of Economy has been one of the biggest sectors to take a hit. America depends on a lot of financial revenues in order to prevent recessions and economic crashes.     One of the biggest sources of revenue throughout the country is real estate. In the last year, many people were unable to work as much as they would like, which means that they were being conservative with the ways in which they spend their money.  Purchasing a house is a luxury that very few can afford, even when they are working as much as they possibly can. The majority of people have instead chosen to invest their money in necessities and other bills that need to be paid.   The mass majority of people tend not to buy their homes outright and instead depend on mortgages in order to be able to do so. However, the banks have been very strict in terms of who they allow getting a mortgage because there is the fear that due to the unseen financial circumstances of last year, people may not have had the ability to pay the required money.   However, as the world is starting to return to normality, the real estate industry is on its way back up. Everyone is getting back to work, which means that financially we are all starting to feel a lot more secure.  Due to this security, more and more people are buying and selling houses.  Many predict that due to the brand new financial security that people are experiencing, we are set to see a 2022 boom in the American real estate industry, but is this really the case?    The 5 Year Forecast   The easiest way for us to make predictions of whether or not next year will be the ‘boom’ year for real estate is by forming a five-year forecast.  A five-year forecast allows you to be able to not only estimate what the real estate industry will be like in the next five years, but it will allow you to have a rundown of what the progression will look like.  You can’t just say that in five years’ time, there will be ‘X” amount of houses sold and bought in America as it is simply impossible to be able to make these predictions. Instead, we look at past sales of homes in America and look at the rate of increase. If the rate of increase is steady, as it currently is, we can then use this to look at what we can expect in terms of sales in the next few years.   After doing this forecast, we could discover that next year will not be the boom and it could instead happen in 2023/2024. However, if we look at the five-year forecast and take into consideration the decline of sales in the last year, by definition next year is likely to be the ‘boom’.    Will There be Another Bust   Something that a lot of people are afraid of is the prospect of a bust rather than a boom. Yes, real estate can be unpredictable at times and nobody could have expected it to take the dive it did in the last year or so. However, the likelihood of there being another real estate bust is extremely unlikely. For the current state of the real estate economy, the only way is up really.  America is starting to build itself back up and it doesn’t seem as though another bust is likely.   If you are someone that is concerned about a potential bust in the future, then we would recommend selling or buying now while prices are so low. However, if you are a house seller it would definitely be in your best interest to wait for a little longer, as though the economy is starting to level out, you will be able to sell your home for a much larger price next year.    Current Home Values   As the real estate industry is starting to build itself back up, you may be wondering what the current housing prices are. It is important to remember that housing prices will be different depending on where you are in the country, which is how it has always been.  Right now the highest price points in terms of home value currently reside in the mid-Atlantic area. This is because a lot of people are looking to escape their busy city lives and head to somewhere a bit more homely.   In particular, homes in Maryland are selling for quite high prices. So, if you are someone that lives in Maryland and you are thinking of selling your home, then you can expect to make quite the pretty penny. If you are looking to sell, we recommend that you go through a complete guide to selling a house by owner in Maryland so that you can fight against the current congestion in the area. However, if you want to make a little more, we recommend that you hold off on selling until next year.  …

Investor focus on Greece

  For the week ending June 19, 2015, the markets rallied on the FOMC meeting announcement and Fed Chairperson Janet Yellen’s quarterly press conference, only to pull back partially on Friday over the Greek debt crisis. The Dow ended the week up 0.65 percent and the S&P 500 up 0.76 percent. In other news: the Fed kept its fed funds rate unchanged, while reiterating that a rate hike will be based on the outcome of economic data; the ECB increased its emergency funds to support Greek lenders; and Russia poses solidarity with Greece. Below is a recap of the markets for each day of the week.   The markets were down on Monday on mixed economic news: manufacturing is very weak (Empire State manufacturing survey; industrial production) while housing is strong (housing market index). Oil edged lower to $59.50. The Dow dropped -0.6 percent to 17,791; the S&P 500 dropped -0.46 percent to 2,084.   On Tuesday the markets rose on continued strength in the new home market (housing starts and permits report); but there is increasing risk of a Greek default. Oil edged higher to $60. The Dow rose 0.6 percent to 17,904; the S&P 500 rose 0.57 percent to 2,096.   On Wednesday the markets initially rallied on the FOMC news, ending modestly higher as Greek debt crisis concerns offset gains. Chair Janet Yellen, at her press conference, feels further improvement in the labor market is needed before a rate hike can be justified. Oil dropped slightly to $59.50. The Dow rose 0.2 percent to 17,935; the S&P 500 rose 0.2 percent to 2,100.   The markets rallied on Thursday due to the dovish FOMC and strong economic news (jobless claims at record low levels; Philly Fed report showing strength in manufacturing). Oil rose $1 to $60.50. The Dow rose 1.0 percent to 18,115; the S&P 500 rose 0.99 percent to 2,121.   On Friday the markets dropped on escalating concerns over Greece with emergency meetings scheduled for next week. Oil dropped slightly to $60. The Dow dropped -0.60 percent to 18,014; the S&P 500 dropped -0.53 percent to 2,110.   The FOMC meeting announcement and Chair Janet Yellen’s press conference on Wednesday made it clear that a rate hike is not likely to occur in September unless economic data supports it; and when it occurs, the Fed plans to raise rates even more slowly than last indicated. Currently, the Fed is forecasting GDP to grow this year by 1.8 to 2.0 percent (that’s down from the prior forecast of 2.3 to 2.7 percent). Nearly all of the 17 Fed officials expect to raise rates this year, but 7 expect only one rate hike (compared to 3 from the last report); it is now considered that the rate hike will occur in December.   The European Central Bank (ECB) increased its emergency funding on Friday for Greece’s financial system after the government failed to broker a deal. Concerns about the Greek banking system had risen sharply as large outflows of cash (about 3 billion euros) from the banks occurred this past week. Funds appear to be flowing out of the banks faster than the ECB can provide them (the ECB increased its emergency funding by 2 billion euros on Friday). So far, withdrawals have not escalated to the level of a full-blown bank run. Over the last five years, Greece’s creditors (IMF, ECB, and other eurozone countries) have committed 240 billion euros in bailout loans. President of the European Council, Donald Tusk, warned Greece not to expect leniency from the lenders on Monday, saying “The game of chicken needs to end, and so does the blame game. There is no time for any games. It is reality with real possible consequences, first and foremost for the Greek people.”   Russia and Greece flaunt solidarity at a business forum. This is not the first time that Russia has hinted a helping Greece, and is simply a way for Russia to thumb its nose at Europe. There are a number of bonds uniting the two leaders: Russia and Greece share the Orthodox Christian faith; Prime Minister Alexis Tsipras in his youth was a staunch Communist; Tsipras has long been critical of the U.S.; and he has opposed the economic sanctions imposed by the West over Ukraine. Bottom line: economists do not believe Russia will lend funds to Greece. What is possible is that Greece will cast a vote against renewing the sanctions against Russia, and all 28 EU member states must cast a vote in favor for sanctions to continue.     The bottom line: considering the dovish FOMC meeting announcement and statement made by Fed Chair Janet Yellen, it is now more likely a rate hike will occur in December; however, if economic news does continue to improve for the labor force and inflation gets above 2 percent, then September is possible. The markets will continue to follow the Greek crisis with increasing interest as June 30 nears.   The focus next week in the U.S. will be the housing (existing home sales; new home sales), manufacturing (durable goods orders; Richmond and Kansas City Fed reports), and consumer (personal income and outlays; consumer sentiment) sectors. In addition, GDP will be watched for signs of further strength in the economy. Globally the focus will be on the Greek debt crisis (a special summit will meet on Monday for all Eurozone presidents and prime ministers). In addition, the focus will be on the following: UK (nothing); eurozone (manufacturing services & composite PMI; M3 money supply); Germany (manufacturing services & composite PMI; ifo business survey); China (PMI manufacturing); and Japan (CPI; unemployment; household spending).   Year-to-date the markets are up: Dow 1.1%; S&P500 2.5%; Nasdaq 8.0%.   The Markets for the past week were: DJIA up 0.6%; S&P500 up 0.7%; Nasdaq COMP up 1.3%.   Commodities (ETFs) for the past week were: Gold (GLD) up 1.67%; Silver (SLV) up 1.11%; Oil (OIH) down -3.63%; Dollar (UUP) down -0.84%; 30-year Bonds (TYX) dropped 4 basis points to 3.06%.   The VIX this past week (a measure of market sentiment and volatility) rose to 13.96% due to growing concerns over the Greek debt crisis.   To see what’s on the calendar for next week, go to the Econoday calendar.   The economic calendar for next week is moderate: o Monday – Existing Home Sales o Tuesday – Durable Goods Orders, PMI Manufacturing Index Flash, New Home Sales o Wednesday – EIA Petroleum Status Report, GDP o Thursday – Weekly Jobless Claims, Personal Income and Outlays o Friday – Consumer Sentiment, Fed Speak   If you’re trading options, it is suggested trading Put Credit spreads for next week at 2.0 standard deviations or greater. Expect the price of the SPX to fall within 2029 and 2193 (2 standard deviations).   For more information about options, see the ‘Suggested Links’ below.…

Stock market preview for the week of June 22, 2015

  The S&P 500 replayed the previous week as the index started and ended the week with losses, but the three midweek sessions finished higher. The midweek rally pushed the index 0.76% higher for the week, mainly on the strength of a 0.99% increase on Thursday. The S&P 500 has finished higher in six of the past ten sessions, but has finished lower in 16 of the past 29.   The S&P 500 broke above the likely resistance from 2112 to 2125 in the upper half of the 100 L at 2100 late in the week. Thursday’s intraday high edged above the resistance to 2126.65, but it slipped to finish the session back within this resistance. Friday’s retreat slipped to a close beneath the resistance level.   The NASDAQ and Russell 2000 finished Thursday at a record closing prices. The NASDAQ also reached a record high with the intraday high of 5,143.316 eclipsing the March 10, 2000 record of 5,132.52. The run to new highs on the NASDAQ was largely due to a surge in Biotech stocks. Many still consider the Biotech Sector underpriced, as can be seen in this recent report by The Street. Let’s take a further look at this story.   The iShares NASDAQ Biotechnology ETF (IBB) was mentioned in this article, but the data for this fund was not used. According to its fact sheet; as of March 31, 2015 the NASDAQ biotech’s had a P/E ratio of 31.60. Due to the continued run since, the P/E calculated from Friday’s close was over 34. The ETF, which had traded relatively flatly prior to Jan 2, 2013, has run up over 166% since.   Eight of the top ten companies in this ETF are S&P 500 constituents and account for 48.48% of the index fund. These eight companies are: Alexion Pharmaceuticals (ALXN), Amgen Inc. (AMGN), Biogen IDEC Inc. (BIIB), Celgen Corp. (CELG), Gilead Sciences Inc. (GILD), Mylan Inc. (MYL), Regeneron Pharmaceuticals Inc. (REGN) and Vertex Pharmaceuticals Inc. (VRTX).   Based on historical earnings increases of the yearly earnings reported by these companies, it took about four years for the total yearly earnings of these eight companies to a little more than double. The current projections for 2016 are about double the reported yearly earnings of four years earlier too. If they could continue to match this performance, and if the other companies’ 51.52% share of the fund could also match this growth rate, and if the stock prices remain unchanged, in about four years this fund could reach a TTM P/E of about 17.   A two year forward P/E of 17 is near historical highs. Since historical earnings suggest it could take about four years to reach this P/E, it seems likely this fund is about twice the price it should be based on historical averages. The percentage of earnings increases the Biotech’s have seen in past five years will become very difficult to sustain at some point. Perhaps they can double earnings in four years again, but company’s earnings histories show that it more likely to take longer to double earnings again. It therefore seems possible this ETF could be nearer to 3 times overvalued.   All the information given about the S&P earnings projections for the S&P 500 and S&P 1500 composite in The Street’s article are based on information available in the S&P Dow Jones Indices S&P 500 EPS download except information on the S&P 1500 composite Biotech Sector. The S&P site was down for maintenance at the time this article was written, so information on the Biotech Sector was not retrieved. The S&P 500 EPS file had been downloaded earlier so it was available to confirm that the other P/E information provided in that article was accurate, although misleading.   The data provided in the S&P 500 EPS report is weighted to the corresponding S&P index. Being so, this data should not be used for comparisons outside of the specific S&P index as the indexes weighting can skew the perspective of this P/E ratio. Instead even weighting should always be used for comparisons outside of a weighted index. Based on even weighting, the current TTM earnings and Friday’s closing price, the eight S&P 500 constituents have a TTM P/E of 32.65, and very close to the P/E found in the iShares fact sheet.   Based on current projections for 2016 earnings for the eight that were updated after Friday’s close, which have also slipped since the S&P report came out, they have an even weighted 2016 forward P/E of 23.31. Since all of these companies have fiscal years that end in December these projections are currently only seven quarters forward, but still very high compared to historical two year forward averages.   This compares to the even weighted TTM P/E of the S&P 500 Health Care Sector of 23.43 and forward P/E of 19.25. Both of these even weighted comparisons are much higher than the weighted P/E provided by the S&P for the index. The even weighted data also shows that S&P 500 Biotech’s are more expensive than the Health Care Sector as a whole, exactly opposite of the data used to show the Biotech’s are less expensive than the overall Heath Care in that article.   Compared to the overall S&P 500 index even weighted TTM P/E of 20.04 and forward P/E of 17.95, it can be seen that the Health Care Sector is very high compared to the overall index. Excluding the Biotech’s, many in the Health Care sector that have seen large price increases are expecting lower earnings in the future. Yet many continue to point investors towards Health Care and Biotech investments. The percentages of earnings increases might be greater in these sectors, but they are already far further forward on these earnings than the index as a whole, making the sectors very expensive.   In addition, a great deal of the current 2016 P/E for the eight rests on Vertex providing positive earnings in 2016. They have recently seen increases in 2016 projections, similar to the earnings increases projected for 2015 at about this time last year. Yet Vertex has not finished a year with positive earnings since 2010 and they are expected to lose money in 2015 too.   The other seven are not expected to grow earnings as quickly as they did before. In fact many have seen projections slide considerably during the past 90 days. It also seems fairly likely Gilead Sciences, which has the lowest TTM P/E of the eight, could see earnings sliced in the coming four years, as their extremely overpriced and profitable Hepatitis C cure runs out of patients to treat. Gilead’s earnings decline is likely to begin in 2016, but snowball from there.   The article notes seven new “blockbuster” drugs in the pipeline, but does not mention them by name. This leaves some guess work involved, but probably the best seven pipeline drugs found are given about a 50% chance of being approved. A 50% chance of approval does not mean 50% of these drugs will be approved, all of them might, but based on past experience it is more likely that only one, two or maybe three of the seven will eventually reach the pharmacy shelves. This makes it appear many are betting heavily against the odds on future growth potentials. Even if all seven were to be approved, a great deal of this new income would be offsetting revenue lost in drugs that will lose market share to new treatments developed by others, loss of drug patent protection, or in the case of Gilead, a decline in the numbers of patients left to treat.   Despite the articles claim’s otherwise, Janet Yellen appears to have done her homework and has valid concerns over the price run ups seen in Biotech’s. It certainly looks like Biotech stocks are running very far ahead of their earnings potential. Being so it seems possible the Biotech’s could be in a bubble. Since the Biotech’s are carrying the NASDAQ higher, it seems possible it too could be in a bubble.   Many foreign markets appear highly overpriced. Many also appear to be in stalls or could be starting retreats from these highly overpriced peaks.   China’s stock market sank lower in the past week. The Shanghai index shed nearly 688 points as it saw four losses of 2% or greater during the week. The week’s largest loss came during a 6.42% setback on Friday. The Shanghai index finished the week 13.32% lower.   Germany’s DAX finished Friday lower and has fallen in 13 of the past 20 sessions. Although slightly higher than recent lows, the DAX finished the week 10.79% below its April 10 close. A fairly large two day rebound in the DAX last week appears to have failed, so it seems possible it could be continuing in the previously established trend lower.   Japan’s Nikkei index has entered an area that it has had difficulty pushing higher in since the 1990 crash. Although losses have been fairly small so far, the Nikkei has seen only four higher closes in the past 14 sessions. Current chart formations make it seem possible it could be rounding lower from recent highs.   US Treasury prices rebounded from recent lows during the past week. The 20 year bond has seen price increases in five of the past seven sessions. The interest rate on the 10 Year US Treasury Note, which moves opposite of the Treasury price, slipped from recent highs as it finished lower in five of the past seven sessions.   Gold bounced back during the past week. It spurted higher after reaching a low of about 1173 on Monday, sank a little lower on Tuesday then saw bursts higher on Wednesday and Thursday. Thursday’s high neared 1206 before slipping and flattening and gold then spent Friday relatively flat near 1200. Gold finished the week with a New York Spot close of 1200.30.   The major Index charts show that the indexes pushed higher in the past week. The NASDAQ and Russell 2000 continued higher after a gap higher at the open on Thursday. Both moved to an all-time high before settling lower to finish at a record closes. Each settled off these highs in retreats on Friday. Both indexes have reached fully overbought conditions.   The S&P 500, Dow Jones Industrial Average and New York Stock Exchange rebounded from retests of earlier lows on Monday. Each reached a high higher than the previous cycle Thursday before beginning to retreat again on Friday. All three are also near fully overbought conditions.       The run showed some bullishness on the indexes, but they are also reaching overbought conditions. The stocks left pushing the indexes higher are for the most part those with the best earnings potential, but also the most expensive stocks based on forward P/E’s.   Although the numbers of stocks that finished Friday below their 200 DMA had decreased to 41.2% from the prior week’s 43.8%, nearly half of the stocks in the S&P 500 have broken below their 200 DMA at least once during the past month. At Friday’s close 259 of the constituents either finished the session below their 200 DMA or less than three percent above it. There were also 291 that finished below the 200 DMA or less than five percent above it.   Netflix (NFLX) has a TTM P/E of over 206 and is 30.92% above its 200 DMA. Normally stocks with a P/E this high would be trading the same distance below their 200 DMA. They are second to only to the 31.39% above the 200 DMA that Allergan PLC (AGN) maintained with a TTM P/E of 20.41. Allergan was formally Actavis PLC (ACT) before taking Allergan’s name and symbol in the past week, two months after completing a merger with them.   The constituents saw a sixth straight weekly increase in projected current year earnings. The total of the constituents’ current year earnings projections edged $0.86 higher than the previous week’s total. Although there was a weekly increase, FedEx (FDX) reported their fiscal fourth quarter 2015 earnings on Wednesday and as a result swapped 2016 earnings with 2015 in the current year totals. Had this not been the case, the constituents would have seen a decline of $1.06 for the week. There were 41 constituents that saw increases (including FedEx) over the projections of the previous week and 64 constituents saw decreases.   As the current quarter’s earnings reports near, current quarter earnings sagged $0.90 lower than the previous week. To this point these earnings have not reflected the much larger decreases seen in the previous two quarters prior to earnings releases, but the prior decreases intensified as those earnings seasons progressed. The quarterly and yearly earnings results reflect adjustments made for spits in two constituents and a name and symbol change of one constituent.   Indicators   The featured and supporting indicators discussed below are not always correct, but they have been many times. Being so they are worth reading about and taking note of.   The 100 L, –/(+) 90 D, (-)/(+) 90 D, +2%, -2% and 90 E indicators are currently active. See a more detailed description of most of the indicators developed through research and featured in these articles here.   The –/(+) 90 D indicator that became active on Feb 26, 2015 entered its expiration period on Wednesday activating a 90 E indicator. It has performed as follows to this point in the standard format: highest close / lowest close / last close.   +0.95% / -3.34% / -0.04%   The (-)/(+) 90 D that became active on May 22, 2015 appears to have bearish potential. It has performed as follows to this point in the standard format: highest close / lowest close / last close.   +0.66% / -1.33% / +0.12%   The +2% and -2% indicators failed to provide a correct indication in the past week. Volatility indicators continued higher in the past week, making it seem likely a volatile move could still be seen.   The S&P 500 saw Monday open a cent higher at the session high of 2091.34 and fall to a session low of 2072.49 before rebounding into a finish of 2084.43. Tuesday started slightly lower at 2084.26 and retreated to a low of 2082.10 before pushing to a high of 2097.40 and to a finish a little lower at 2096.29. Wednesday opened higher at 2097.40 and slipped to a low of 2088.86 and pushed to a high of 2106.79 before falling to a finish of 2100.44. Thursday opened with a gap higher to the session low of 2101.58 and pushed to a high of 2126.65 before settling into a lower close of 2121.24. Friday opened a little lower at 2121.06 and moved to a high of 2121.64 before slipping to a low of 2109.45 and closing slightly higher at 2109.99.   Monday retreated from likely resistance between 2085 and 2100 in the lower half of the 100 L to a low near but above the previous low at 2072.14. Although this level is outside of a likely support area, the two rebounds very near this level make this support seem somewhat valid. Monday finished near but below the likely lower half resistance. Tuesday pushed back into and finished within the likely lower half resistance of the 100 L. Wednesday’s low found support in the likely lower half resistance before moving and finishing in the upper half of the 100 L. Thursday left a still unfilled gap in a run above the likely resistance from 2112 to 2125 in the upper half of the 100 L, but settled lower off that high to finish within this resistance. Friday failed to hold within the likely upper half resistance as the retreat from Thursday’s high continued, and fell to a finish below the likely resistance.   The past week’s retreat again finished with a rebound at an unlikely support level, but near the same support found earlier, giving this support a degree of validation. It is still outside of a likely support level, which tends to make support found in these areas weak, so another retest of this support level could break lower through it. Thursday’s push above the upper resistance boundaries of the 100 L probably weakened it slightly, but the index fell directly off this break showing this resistance still has some fight left in it.   The resistance in the 100 L continues to trouble the S&P 500 so it continues to seem possible the index could see a significant retreat from this resistance. The US markets so far have not succumbed to the increases seen in volatility indicators, but other markets have. The US could remain immune, but the potential for volatile market moves is currently very high.   The average daily volume increased 12.88% above the previous week. The highest volume was seen during Friday’s triple witching and lowest volume in Tuesday’s gain. The five day volume variance increased by 26.84% to finish the week at 52.39%. The increase in the weekly volume and five day volume variance was largely influenced by the stronger volumes seen during Friday’s triple witching.   Friday’s volume was quite a lot lower than that seen during the triple witching in March or December. The lower volumes could indicate investors rolled future contracts over instead of buying the underlying securities. If this was the case it is potentially bullish as traders of futures are showing confidence that stock prices could move higher. It also seems possible this lower volume could be misleading. Stock volumes were much higher early indicating a possible exit in futures occurred then, this possible exit coupled with the relatively flat market since may have limited entries since. Add the potentially bearish news remaining atop of the headlines and it seems possible the lower volume could just mean fewer contracts were held to begin with.   Current Cautions   Several potentially bearish indicators are currently active. Volatility indicators continued higher in the past week and indicate much higher than normal chances of volatile market moves. Many of the indices and stocks have rebounded back into to overbought conditions.   China’s Tech bubble could have begun to deflate. The Shanghai index finished the week 13.32% lower. Many other highly overpriced world markets appear to be stalled or in declines from recent peaks.   Although some still claim there are under priced markets outside the US, there are no “cheap” stock markets left in the world. The long run of very low interest rates has run stock prices to overvalued levels in all markets. Most are further overpriced than the US. There may be reason to believe some foreign markets could run to even higher over valuations, but foreign markets generally fall much further than the US market in retreats, making investments abroad look very risky.   The S&P 500 constituents saw a sixth consecutive week of current year earnings projection increases, with the current increase due to a change in a constituent’s current year earnings. The total of these increases remains small.   Early season earnings reports were not very encouraging in the past week. FedEx (FDX) and Oracle (ORCL) both missed expectations. The FedEx miss shows potential weakness in mail orders, while Oracle reported that currency exchange losses accounted for an 8% decline in EPS, making currency exchange a possible issue with others. Both could be earlier indicators of continued earnings trouble ahead.   Many conditions continue to make a large drop on the index seem possible. Many chart formations and past occurrences of these formations make it seem possible the index could see this retreat before the end of the year.   The next likely resistance level above the 100 L at 2100 could be seen at the 2140 to 2160 MRL. Earlier highs on the index could have seen the effects of this resistance level, but the index is still within the influence range of the 100 L and has not yet reached this resistance level, being so this resistance is not yet considered active. This resistance appears to have the potential to cause a significant pullback.   Please note there is no established resistance in the MRL levels before the index has reached these levels. Several instances have proven to hold resistance once reached; however MRL levels that the index has not yet reached are only the most likely levels that resistance will be seen based on research. Back tests of the data used to project these resistance levels work well, but they are not always exact, and these resistances could react sooner or later than expected, it is also possible the resistance will not be seen at all.   Data provided for the S&P 500 was derived from the historical daily data tables, similar data can be found at AOL Finance. Earnings information was gathered from Yahoo Finance, CNBC, Edgar Filings, Scottrade Elite, AOL Finance and Morningstar, although other websites, including company websites, may have contributed small amounts of information. Stock and Treasury charts used for analysis and commentary were provided by StockCharts.com, Scottrade Elite or from those that Ron created from his data. Gold charts used for analysis and commentary were provided by Kitco.   Have a great day trading.   Disclosure: Ron currently has investments in ORCL. Ron has no investments in IBB, ALXN, AMGN, BIIB, CELG, GILD, MYL, REGN, VRTX, NFLX, AGN, ACT or FDX. Ron is currently about 56% invested long in stocks in his trading accounts reflecting a decrease over the past week’s investment level. This decrease was the result of the sale of one issue and dividend payments. Ron feels he is overbought given the current market conditions; however since his investment level is below the levels originally planned for months ago, he may also reinvest a portion of these sales. Ron will receive dividend payments from five issues in the coming week and 26 in the following week. If no further investment changes are made during this time frame, these dividend payments would reduce his rounded investment level.   Disclaimer: The information provided in the Stock Market Preview is Ron’s perception of the current conditions and what he thinks is the most probable outcome based on the current conditions, the data collected and extensive research he has done into this data along with other variables. It is intended to provoke thought of the possible market direction in his readers, not foretell the future. Ron does not claim to know what the stock market will do. If the stock market performs as expected, it only means he is applying the stock market history to the current conditions correctly. His perception of the data is not always correct.   This article is intended to provoke thought about investment possibilities. Acting on the information provided is at your own risk. You are urged to do your own research, and where appropriate, seek professional investment advice before acting on any information contained in these articles.…

Weekly market recap: Markets tumble then recover

  For the week ending July 10, 2015, the markets yo-yoed on news of the evolving Greek debt crisis and China’s equity market turmoil. The Dow ended the week slightly up at 0.2 percent while the S&P 500 ended flat. In other news: Greece submits new plan which capitulates to its creditors’ demands; China’s stock market in a freefall responds to government action; the IMF revises its global outlook; and Fed Chair Janet Yellen still considering a rate hike in 2015 despite Greece and China. Below is a recap of the markets for each day of the week.   The markets were down on Monday as the Greek referendum vote on Sunday was ‘no’ to the austerity terms of its creditors. Oil reacted sharply to the news falling nearly $4 to $52.75. The Dow dropped -0.3 percent to 17,683; the S&P 500 dropped -0.39 percent to 2,069.   On Tuesday the markets rose after a very choppy day in which the markets were down as much as -1 percent in the morning. Economic news for the day was weak: exports fell -0.8 percent; imports down -0.1 percent. Oil remained flat at $52.75. The Dow rose 0.5 percent to 17,776; the S&P 500 rose 0.61 percent to 2,081.   On Wednesday the markets dropped significantly as China’s markets were in freefall and trading on the NYSE was halted nearly 4 hours due to a technical glitch. Oil dropped $1 to just below $51.75. The Dow dropped -1.5 percent to 17,515; the S&P 500 dropped -1.67 percent to 2,047.   The markets rose on Thursday as the Chinese markets ended their freefall making a modest gain, and Greece met its deadline to submit a new reform proposal. Oil rose $1 to $52.75. The Dow rose 0.2 percent to 17,548; the S&P 500 rose 0.23 percent to 2,051.   On Friday the markets rose dramatically as the Greek proposal was in-line with the requirements of its creditors, raising hopes for a bailout agreement. Oil was little changed near $52.75. The Dow rose 1.2 percent to 17,760; the S&P 500 rose 1.23 percent to 2,077.   The markets ended a volatile week little changed. The Dow eked out a 0.2 percent gain for the week after gaining 212 points (1.2%) on Friday; the S&P 500 ended nearly flat after gaining 25 points (1.2%) on Friday. The news that drove the markets was: the expectation that a bailout deal for Greece is very close; and the markets in China staged a nice rally.   The proposal submitted by Greece shows the Syriza government has agreed to the austerity terms of its creditors. This has occurred just five days after a landslide referendum vote rejected the terms. Prime Minister Alexis Tsipras, putting the best face on a failed outcome, said “We are confronted with crucial decisions. We got a mandate to bring a better deal than the ultimatum that the Eurogroup gave us, but we weren’t given a mandate to take Greece out of the eurozone”. The proposal will be discussed on Sunday, and any deal will likely lift the ECB’s freeze on emergency funds for the Greek financial system. The ECB freeze has been controversial given its mandate to uphold financial stability, and there is some question as to its legality. The saga is not over, and there is some concern that the creditors will want further stringent austerity measures.   China’s stock market, which has been dropping sharply over the last few weeks, has responded to emergency measures implemented by the government. The emergency measures were a barrage of support measures designed to have an immediate short-term impact: a cut in interest rates; suspension of IPOs; reduction in margin requirements and collateral rules; and the enlisting of brokerages to buy back stocks using cash from the PBOC (China’s central bank). Additional measures are expected from the PBOC over the next few weeks. During the stock market slide, the two key Chinese markets lost over 30 percent from their mid-June peak; the turmoil became a greater concern than the Greek debt crisis.   The IMF cuts global growth projection for 2015. The new global growth projection is 3.3 percent (down from 3.5 percent) citing weaker-than-expected growth in North America; the projection for 2016 remains unchanged at 3.8 percent. Other factors cited were: a rebound in oil prices; rising bond yields; and weak inflation. The report also stated “The underlying drivers for a gradual acceleration in economic activity in advanced economies—easy financial conditions, more neutral fiscal policy in the euro area, lower fuel prices, and improving confidence and labor market conditions—remain intact”. With regard to Greece, the report stated “As dramatic as the events in Greece are, Greece accounts for less than two percent of the euro zone GDP, and less than one half of one percent of world GDP,” he said. “There is little question that Greece is suffering and may suffer even more under the scenario of a disorderly exit from the euro zone. But the effects on the rest of the world economy are likely to be limited.”   Fed Chair Janet Yellen maintains her call for a rate hike in 2015. Speaking Friday after weeks of market turmoil due to Greece and China, Yellen states “I expect that it will be appropriate at some point later this year to take the first step to raise the federal funds rate and thus begin normalizing monetary policy”. She continues to remain cautious, adding “the course of the economy and inflation remains highly uncertain, and unanticipated developments could delay or accelerate this first step.” Economic expansion has entered its seventh year with unemployment falling; yet the job market “still has not fully recovered.” Yellen remains optimistic that economic growth will pickup in the coming years.   The bottom line: despite weakness in exports and minimal strength in the labor market, the services sector remains strong and should keep the economy moving forward. If GDP maintains a 2.5 percent growth rate, the Fed is likely to initiate a rate hike.   The focus next week in the U.S. will be retail sales (Tuesday), industrial production (Wednesday), housing market index (Thursday), and housing starts, consumer price index and sentiment (Friday). Globally the focus will be on Greece and China, and Fed Chair Janet Yellen’s testimony in front of Congress. In addition, the focus will be on the following: UK (CPI, PPI, labor market report); eurozone (ECB monetary policy meeting, industrial production); Germany (ZEW survey); China (merchandise trade, GDP, industrial production, retail sales); and Japan (BOJ monetary policy meeting).   Year-to-date the markets are mixed: Dow -0.4%; S&P500 0.9%; Nasdaq 5.5%.   The Markets for the past week were: DJIA up 0.2%; S&P500 flat; Nasdaq COMP down -0.2%.   Commodities (ETFs) for the past week were: Gold (GLD) down -0.24%; Silver (SLV) down -0.47%; Oil (OIH) down -2.66%; Dollar (UUP) down -0.28%; 30-year Bonds (TYX) rose 2 basis points to 3.21%.   The VIX this past week (a measure of market sentiment and volatility) rose to 16.83% due to growing concerns over China and Greece.   To see what’s on the calendar for next week, go to the Econoday calendar.   The economic calendar for next week is moderate: o Monday – Treasury Budget o Tuesday – Retail Sales o Wednesday – EIA Petroleum Status Report, PPI-FD, Empire State Mfg Survey, Industrial Production, Beige Book, Fed Speak (Janet Yellen) o Thursday – Weekly Jobless Claims, Philadelphia Fed Business Outlook Survey, Housing Market Index, Janet Yellen speaks o Friday – Janet Yellen speaks   If you’re trading options, it is suggested trading Put Credit spreads for next week at 2.0 standard deviations or greater. Expect the price of the SPX to fall within 1987 and 2170 (2 standard deviations).…

Markets choppy on Greek debt discussions

  For the week ending June 12, 2015, the markets were slightly up with the Dow up 0.3 percent and the S&P 500 up 0.1 percent. Economic data for the second quarter shows improvement, with strong gains in retails sales and a positive consumer sentiment report. The markets were choppy as news on the Greek debt crisis vacillated from good to bad, and as the World Bank lowered global growth estimates and suggested that the Feds maintain current interest rates till the first half of 2016. Below is a recap of the markets for each day of the week.   The markets were down on Monday on little economic news. Oil edged lower to $58.50. The Dow dropped -0.5 percent to 17,766; the S&P 500 dropped -0.65 percent to 2,079.   On Tuesday the markets rose on the JOLTS report, with historic gains for job openings in April. Oil rose over $1 to $60. The Dow dropped fractionally to 17,764; the S&P 500 rose fractionally to 2,080.   On Wednesday the markets bounced back on news that Germany is moving toward an agreement with Greece. Oil rose $1 to $61. The Dow rose 1.3 percent to 18,000; the S&P 500 rose 1.2 percent to 2,105.   The markets rose slightly on Thursday due to a mix of strong economic news and bad Greek negotiation news. Jobless claims remained at low levels, while retail sales showed a strong gain; it is now expected that the Fed will raise rates in September. On the bad side, the IMF negotiators threw in the towel and have returned to Washington, increasing the chance of a Greek default. The Dow rose 0.2 percent to 18,039; the S&P 500 rose 0.17 percent to 2,109.   On Friday the markets dropped on strong economic news, but poor news about Greece. Consumer sentiment shot up, along with a good producer price report. News out of Greece is getting worse with a default appearing unavoidable. Oil dropped nearly $1 to $60. The Dow dropped -0.80 percent to 17,898; the S&P 500 dropped -0.70 percent to 2,094.   The Fed stated in their last policy meeting that a weak first quarter was due to “transitory” factors; it appears the Fed was correct with second quarter economic news showing strong improvement with motor vehicle sales jumping 2.0 percent and retail sales rising 1.2 percent, along with improvements in the trade deficit, jobs, and the service sector. There were also solid upward revisions in prior months which now have encouraged economists to raise second quarter GDP estimates to 1.9 percent (from 1.1 percent). Greek debt negotiations have been vacillating between encouraging and discouraging causing choppiness in the markets this past week. A big gain in the markets occurred on Wednesday when Germany announced it was making progress toward a settlement with Greece, only to be dashed when IMF negotiators left the discussion table citing a broad intransigent difference between the negotiating parties. As of Friday, it appears a certainty that Greece will default at the end of this month. To add to the uncertainty, the World Bank reduces it 2015 global growth forecast to 2.8 percent (down from 3.0 percent). This adjustment reflects the slowdown in emerging markets and softer U.S. output. Moderate growth in Europe and Japan has been offset by contractions in Brazil, Russia, and Turkey. Add to this the slowing growth in China (the second largest economy), and emerging markets are facing a dangerous mix of headwinds.   The bottom line: while the second quarter is improving, it is not as robust as hoped. The Fed is not likely to change interest rates next week, but the consensus is for a rate hike in September. The markets will be affected daily by the constantly changing news on the Greek debt crisis.   The focus next week in the U.S. will be the Federal Reserve’s FOMC meeting, its updated forecasts, and the press conference with Chairperson Janet Yellen. Manufacturing will also be in focus with the Empire State and industrial production (Monday) and Philly Fed (Thursday). The housing market index (Monday), and housing starts & permits (Tuesday) will provide hard data on the housing sector. Globally the focus will be on the U.S. FOMC. In addition, the focus will be on the following: UK (BoE monetary policy meeting minutes, consumer price index, labor market report, retail sales); eurozone (harmonized index of consumer prices); Germany (ZEW business survey); China (nothing); and Japan (BoJ monetary policy announcement, merchandise trade).   Year-to-date the markets are up: Dow 0.4%; S&P500 1.7%; Nasdaq 6.7%.   The Markets for the past week were: DJIA up 0.3%; S&P500 up 0.1%; Nasdaq COMP down -0.3%.   Commodities (ETFs) for the past week were: Gold (GLD) up 0.88%; Silver (SLV) down -0.91%; Oil (OIH) down -1.19%; Dollar (UUP) down -1.62%; 30-year Bonds (TYX) dropped 2 basis points to 3.09%.   The VIX this past week (a measure of market sentiment and volatility) dropped to 13.78% due to an improving economy.   To see what’s on the calendar for next week, go to the Econoday calendar.   The economic calendar for next week is moderate: o Monday – Industrial Production, Housing Market Index, Treasury International Capital o Tuesday – Housing Starts o Wednesday – EIA Petroleum Status Report, FOMC Meeting Announcement, Fed Chair Press Conference, FOMC Forecasts o Thursday – Weekly Jobless Claims, Consumer Price Index, Philadelphia Fed Business Outlook Survey o Friday – Quadruple Witching, Fed Speak   If you’re trading options, it is suggested trading Put Credit spreads for next week at 2.0 standard deviations or greater. Expect the price of the SPX to fall within 2016 and 2174 (2 standard deviations).…

Foreign income tax returns: Finishing strong in 2015

Well, we’re now officially halfway through 2015. For some people, that’s something to celebrate as they wave a happy farewell to tax season. For the really lucky ones, they have a bit extra spending money for the rest of the year. But for a lot of people, they’re in the same worried state that they’ve been in since the new year rolled around. So, if you find yourself wondering about deadlines for filing foreign returns, this one is for you.   As of June 30th, the deadline has passed for reporting ownership of foreign bank accounts. Whenever an individual holds more than $10,000 in a foreign bank account, they are required to file a special report called an FBAR (Foreign Bank Account Reporting Form – official name FinCEN Report 114). Income from foreign bank accounts is usually taxable in the US. If you missed the deadline for filing your FBAR, it would probably be in your best interest to contact a tax expert and discuss your options.   Despite the fact that a number of important deadlines have already passed, there are still quite a few to be wary of. Knowing the deadlines is the first step towards making sure you don’t miss those that apply to you!   July 31 – Foreign life insurance   The end of July marks the deadline for those that paid for foreign life insurance premiums between April and June of 2015 and for those that have excise taxes to report. Make sure to file on time and keep the wrath of the IRS at bay.   Unfortunately, the IRS isn’t terribly fond of foreign life insurance policies to begin with. And why is that? Foreign policies take away from domestic ones, and domestic life insurance policies have a small army of lobbyists fighting for them. It’s worth noting that the IRS does not have to treat foreign life insurance as a life insurance policy for tax purposes. They hold the power to consider it an investment, which is never in your best interest.   September 15 – Third estimated payment of 2015   This one might make you scratch your head a bit, seeing as you’ll be paying the third quarter payment before the quarter is up. It doesn’t make a huge amount of sense, but you can at least find some solace in the fact that the fourth quarter payment won’t be due for another four months, making its deadline January 15, 2016.   October 15 – Extended deadline for filing individual returns   This one needs some clarification. If you were to have filed for an extension before April 15th (or June 15th for US expats), you have until the 15th of October to file your returns. I want to make it very clear though that this is for filing and not for paying your returns.   If a taxpayer is outside of the US on the extended filing date (Oct. 15), they can request another two month extension. This request is up to the discretion of the IRS, so it’s best to not count on it as a sure-fire thing.   October 31 – Foreign life insurance   Exactly the same as the July 31st deadline, but this time it’s the payment deadline (and excise reporting) for the months of July, August, and September of 2015.   December 15 – Extended deadline for certain taxpayers   As mentioned above, this deadline is for those that requested an additional two months extension past the October 15th deadline. The IRS does not have to honor your request for a deadline extension, but if you’re outside of the US at the time of filing and have a reasonable need for the extension, you shouldn’t run into any problems.   Make your life easier   Taxes are complex and all the deadlines and rules can be overwhelming. I completely understand that. But do yourself a favor and be sure to request your foreign bank account statements a good deal in advance. Not all foreign banks can provide you with a yearly statement for your tax purposes. Therefore, by contacting them early enough, you can find out if they do generate end-of-the-year statements, or – if they aren’t able to do so – if they can provide you with a statement of your highest account balance during the year. It definitely pays to think ahead and make sure your filing process is as smooth as possible.   As always, do everything in your power to make these deadlines and resolve any problems that may have delayed you from timely filing and payments. This will ensure that you stay on the good side of the IRS and put your finances on track to be as smooth and stress-free as possible. As always, if you find yourself about to pull out your hair from the stress of it all, don’t hesitate to ask someone for help. Taxes are confusing, so finding someone who can help you unravel what you need to disclose and what you need to pay can be a lifesaver.…

The racist attempt to start a race war in South Carolina fails

  The attempt to start a race war in South Carolina failed. The lone racist, who murdered 9 innocent African-Americans on June 17, 2015, sits in a jail cell in Charleston waiting for the American judicial system to determine his fate. It was not the first time a plan to kill people because of their race was averted in South Carolina. On July 19, 1822, Denmark Vesey and 34 of his followers were killed after the plan of their revolt to kill whites was discovered.   Denmark Vesey was executed in Charleston, South Carolina for his plot to murder white people in 1822. He was unable to kill a single white person because an African-American felt it was wrong to murder men, women, and children and reported the plot before the murders could be carried out. It was a white America who aided police in the capture of Dylann Roof.   On Father’s Day 2015 over a thousand people of all races, all religions, and all sexes gathered in Charleston on the Arthur Ravenel, Jr., Bridge to let the world know that the attempt to create division and race hatred failed. The plan to divide Americans backfired. There was more love and unity between the races in South Carolina than ever.   Charleston is a beautiful city and a wonderful vacation location. The customer service in the city is excellent. Tourists will find one of America’s greatest Civil War Memorials in Charleston where President Abraham Lincoln’s greatest challenge to save America began in 1863.   Charleston native Alex Sanders was interviewed by the present writer on May 11, 1974, as he ran for Lt. Governor of South Carolina. Sanders would become the future president of the College of Charleston. Sanders welcomed all people to visit the beautiful city. There many evil people in the world who will never change their evil ways. To try to create a race war because of the circumstances in one life to the detriment of over 3 million people is pure evil. A great man once said, All it takes for evil to prevail is for good men to do nothing.”   A chain from the House of the Slaves from Goree Island in Senegal was donated to the people of Charleston in 1986 to remember the African American slaves who were brought to the slave market there. The 400 year old chain is on display at the Avery Research Center for African American History and Culture.   The hidden agenda to start a race war between black and white Americans failed because great leaders like Alex Sanders have been working for decades to create a city of Charleston that celebrated the history and culture of all Americans. Another great South Carolinian from Charleston worked hard to create good relations between blacks and whites served as the City Editor for the present writer at The Columbia Record. He was a third generation newspaperman from Charleston and had malice for none. Robert Hitt III showed fairness and respect for black and white South Carolinians alike. His dedication to the truth was the fundamental principal of his work and he passed that work ethic to every journalist who was fortunate enough to serve on the same newspaper with him.   When Hurricane Hugo struck the city in October of 1989, while the present writer was completing his Ph.D research on Charleston native Daniel Alexander Payne, the people of Charleston pulled together after many of them lost their homes, cars, boats, and possessions. As people fought for their lives there was no division between black and white in surviving the devastation. The journalist witnessed people helping people regardless of race, creed, or color.   Charleston remains a beautiful and compassionate city. For Americans planning a vacation location this summer there is no place finer than to visit Charleston, South Carolina.   Examiner.com will continue to follow the events in Charleston, South Carolina. The nation continues to mourn the loss of innocent lives on June 17, 2015.…

Only paying what you can afford with the IRS Fresh Start Program

  For a lot of us, the word compromise doesn’t bring up the most positive of feelings. We understand that we have to give up a portion of something we want in order to appease someone else. Well, it’s an unfortunate reality that when dealing with the IRS, you’re almost never going to get everything you want while depriving them of the thing that they want most – your money.   Unfortunately, clamping your wallet shut isn’t a suitable defense against the IRS. There are far too many tax resolutions firms and “experts” out there claiming to have a way to get you off scot-free. I’m here to set the record straight. There’s no such thing as a magic fix for tax problems. I always tell my clients that they’re going to have to pay something, but through hard work and experience, we’re going to do everything we can to trim that number down significantly.   The first thing I looked at when the IRS Fresh Start Program was put into place was the offer in compromise guidelines. The new guidelines, while not being entirely clear as to what’s changed, do allow IRS Agents more flexibility when deciding whether an offer in compromise is reasonable. We’ve now come to the keyword of my firm’s approach to offer in compromise – reasonable.   You have the right to remain reasonable   I’m just going to have to assume that you wouldn’t go to the store, pick up a gallon of milk, bring it to the register, and tell them you would give them $.10 for it. The price you’re offering has absolutely no basis in reality. From feeding the cows to having the milk transported, there are reasons that milk costs what it does. That being said, if the same grocer was to dramatically increase the price to $100 per gallon, you’d be justified in being outraged. At that price point, many people would be unable to buy milk, a staple to the diet of many Americans. The point of the matter is that a reasonable compromise has to be met in order to cover the needs of those producing the milk and those doing the purchasing.   In similar fashion, offers made to the IRS need to take two factors into mind: the IRS needs some sort of payment to cover your debts and you have to be able to afford that amount. Looking at your assets and your liabilities allows you to find out how much you can afford to pay to get the IRS out of your life. Fair vs. Able   There’s a very distinct divide in the thinking done by IRS Agents and by taxpayers and their representation. The IRS operates under the assumption that the amount you pay should be fair. Regardless of the circumstances, you unfortunately found yourself behind on your tax payments. IRS Agents often operate under the mentality (even though it does not exist anywhere in the Internal Revenue Manual) that the amount you pay back should be indicative of your debt to society. Because you didn’t pay your taxes, you are asking other taxpayers to shoulder the burden of what you owe.   That’s just not accurate. Whether in Fresh Start or regular offer in compromise, it all boils down to what you are able to pay. You’ll be given sheets that help you come to the number that you can feasibly pay to wipe your debt away. Always remember that the IRS is not going to do anything that’s not in their own interest. Just because they try and guilt someone into feeling that they’re being unfair doesn’t mean that holds any basis in reality.   Same old story   An offer in compromise will only work if the IRS does not believe that you are able to either pay off the entire sum or to whittle it down via installment agreement. They’re never going to do anything that doesn’t have the most benefit for them. An offer in compromise – requiring both sides to give up something – is only going to work if the IRS doesn’t think they can squeeze you for more. This is true regardless of whether or not an individual is taking part in the Fresh Start Program or not.   While offering some more leeway with the guidelines, the IRS Fresh Start Program, as it relates to offer in compromise, isn’t that far removed from the previous guidelines. The program is put there to be better attuned to a variety of real-world circumstances. When everything is said and done, offer in compromise boils down to offering an amount that reflects your current situation and ability. You have the right to remain reasonable.…

Karatbars: Where contrary to Warren Buffett, you can earn a return buying gold

  Back in 1998, billionaire investor Warren Buffett gave a speech at Harvard University where he unashamedly stated his disapproval with owning physical gold, citing its lack of a dividend or return as the premise for his beliefs. This doctrine was also passed onto to his longtime partner Charlie Munger who stated in more recent times that gold is only good for Jews trying to flee the Nazi’s during the time of the holocaust.   Karatbars one ounce gold with LBMA certification Courtesy of karatbars But like most of finance, things change over time and savvy companies and investors find ways to make money off of valuable assets. One such company that is creating a niche in the gold market is Karatbars, and is right now revolutionizing how people can not only own physical gold for their investment portfolios, but also how they can use the company’s own model to build their own relational marketing business. In addition, business affiliates who become registered can even own their own offshore account that can be accessed online 24 hours per day, or through a Mastercard which is usable almost anywhere around the world that accepts this well established form of money.   Karatbars was started in 2011 out of Stuttgart, Germany, but has connections in over 75 countries that include the United States. It’s mission and scope is to not only provide customers with the choice of purchasing gold that is backed by one of the world’s leading assayers, the London Bullion Market Association (LBMA), but to also provide the option of having their gold stored onsite in Karatbars vaults at absolutely no cost to the customer.   Additionally, individuals or businesses who choose to become affiliates can get paid for both gold purchases and package purchases from anyone they signup and refer, and their gold holdings as well as commissions can be uploaded from a free offshore account at anytime to a pre-loaded Mastercard that is good anywhere around the world Mastercard is accepted.   For those looking to start their own home business or as a add-on to their current corporate enterprise, Karatbars only allows new affiliates through sponsorship, meaning that someone cannot create an account without using or referencing a sponsor. This alone is a great selling point for affiliates as they can speak about Karatbars without the fear of someone simply signing up under themselves based upon your work and information.   Network or relational marketing has changed immensely over the past 15 years, with the stigma of companies like Amway a thing of the past. In fact many people might not realize but when you use Google Ads or have an affiliate account with Amazon on your personal or business website, you are functioning in the capacity of network marketing. And as the global economy moves in an even greater direction towards online and centralized retail, the use of individual marketers and sellers is the new era of business, and is becoming the best way for workers to achieve unlimited earnings predicated on how much work, effort, and study they put into it.   As opposed to companies that are tied to disposable and usable products, Karatbars has only one product, and is something that does not disappear at the end of the month, or is thrown away once the ‘bottle’ is empty. Being part of a business that provides you a commission for the buying and selling of gold, while offering a free offshore system of storage and a way to liquidate it into cash at the click of a button is something that appeals to investors, owners of any retirement fund, or people who are interested in a hedge against the dollar and any other currency. Additionally, Karatbars is a potential opportunity not just for the well off, but also for the over 92 million Americans who are either unemployed or under-employed following the credit crisis of 2008 that nearly brought down the entire banking system.   Prior to 2000, the majority of small businesses were the brick and mortar types that required vast amounts of overhead and hundreds of hours per week just to bring their businesses to profitability. However, with the advent of the internet and the fact that banks are ceasing their monetary support of Main Street small businesses, the home business or network marketing model is the surest and fastest way to make a living and to satisfy the deep desire in many people to be their own boss and work their own hours as they see fit.   In the end, there are many different network marketing models and business opportunities, but few offer the features that Karatbars does, and at an extremely minimal cost. For around $350, a person or business can purchase a silver package that pays a return of 10% on any affiliate you sign up that also buys a package, as well as receiving a commission percentage on every gram of gold purchased by these same customers and affiliates you have signed up… meaning the potential is infinite dependent upon your goals.   In addition, and unlike many other network marketing companies, there is no required monthly purchases or ‘autoships’, meaning after your initial purchase of an affiliate package (Bronze, Silver, Gold, VIP), you can fund your own gold purchases, as well as grow income directly from your earnings, as you sign up more individuals and companies.   In full disclosure, I am an affiliate with Karatbars, and have in a very short time become very successful in building a business from it, as well as the opportunity to buy physical gold and hold it offshore. I also have my own offshore account that is not regulated or reported on via FACTA since Karatbars is not a bank, and not required to report anything to the I.R.S. or other financial regulatory agency.   As the National Finance columnist for Examiner.com, and a contributor to several other online publications, I would not write on a topic, company, or opportunity if I did not believe it was both legitimate, and potentially beneficial to you, the readers. And if this company and business is something you might find of interest, you can sign up under my referral link below, or contact me through my Examiner contact link.   https://www.karatbars.com/signup.php?s=argonath   Also make sure you take a look at the video connected to this article. One member group has done an extraordinary job showing you how easy it is using just one of the seven ways to earn money through Karatbars, and to build your own six figure income in just seven weeks starting with finding just two people and letting the power of network marketing do the rest. In fact, if you look at it honestly, Jesus may have been the greatest network marketer ever as he took just 12 people and built a billion personfollwing from it that has lasted for over 2000 years.…

Stock market preview for the week of July 13, 2015

  After slipping to the lowest close so far in the current retreat during a 1.67% drop on Wednesday, the S&P 500 got a pair of large opening gaps higher in the final two trading days. Although Thursday’s opening gap higher nearly vanished before the close, the index retained and added to early gains Friday, before slipped fairly steeply into the finish that was $0.26 lower than the previous week and a 0.008% loss for the week. Although the loss was small, it was the third straight weekly decline and fifth setback in the past seven weeks.   The S&P 500 saw Thursday start with an opening gap that was likely much higher than the “official” opening price. The S&P Dow Jones Indices no longer uses the opening stock prices in its calculations for the “official” opening price of the S&P 500 and Dow Jones Indices in an attempt to limit opening price gaps. For comparisons, the value of the highest price in the first minute is used as an opening price basis due to the manipulated “official” opening price.   The index reached 2064.81 in the first minute of trading, which was well below the over one percent higher futures value at the open. The NASDAQ and Russell also saw opening gaps higher, and their opening prices were very near their first minute highs. After the S&P 500 pushed higher for nearly the first seven minutes, the index saw most of the opening gap melt away through the remaining session and finished with only a small gain of 4.63 (0.23%).   Friday also opened with a large gap that was likely much larger than the “official” open as it reached a high of 2068.33 in the first minute of trading. This first minute value was also well below the over one percent higher futures value at the open and the NASDAQ and Russell again gapped to opening prices very near their first minute highs. This time the S&P 500 began to slip lower after nearly eight minutes of gains. That slide continued until it saw the first of two bursts higher. Each of these moves higher lasted a little over an hour and each broke long downtrends during the session. These pushes higher overshadowed the declines seen during the remainder of the session.   Aside from short runs after opening gaps and the two relatively short bursts pushing prices higher Friday, the overall price action during the two sessions gave the impression a selloff was in progress, not the resulting rebound in stock prices that took place. Thursday saw less than six minutes of gains finish above the first minute high and shed 13.50 points into the close, while Friday closed only 8.29 points above its first minute high and was again falling into the close.   Thursday’s unemployment numbers appear to show that recent increases in companies that are using layoffs as a means of cost reduction are taking a toll. Thursday’s report showed the seasonally adjusted initial claims increased over the recent four week average. It also shows the year over year change in the unadjusted Persons Claiming Unemployment Benefits in All Programs increased by over 318,000 from the year ago levels.   Several more companies announced plans to make layoffs recently including Microsoft (MSFT). They plan to shed 7,800 employees after dropping more than 10,000 jobs in the previous year. Although many of these jobs are outside the US, worldwide upticks in unemployment also affect earnings. If this trend in increased company layoffs continues, it likely means an employment peak has been reached. This also fits fairly closely to normal employment trends.   Although these layoffs are meant to produce cost savings, as they become more common they generally increase unemployment numbers, which prove to hurt earnings across a broader range of companies. This in turn generally tends to feed the cycle of cost savings by layoffs, which in turn reduces earnings further. To make matters worse, companies nearly always underestimate the costs associated with these layoffs, so savings are seldom what they expected to begin with. The increase in announced layoffs is an early indication that earnings expectations could be too high going forward.   Many of the World Indices broke below the lower trend channel in dips they took during the week. Others, like the Nikkei 225, broke the support that it had rebounded off to a 52 week high on June 24. That support break came during three volatile drops in the past ten days. Several did not see volatile daily retreats into breaks lower, but still broke support or fell through the lower trend line in recent retreats. Many of the rebounds after volatile retreats have failed at or near moving averages, trend lines or other resistances. This type of action seen across a broad range of indices could be a warning sign. It has often led to a steepening in drops in the past.   Controls aimed at preventing a continued fall in China’s markets were installed during the week. It included postponement of all IPO’s, caps on short selling, retirement funds being used to prop up the market, a six month moratorium on sales by investors with 5% or larger stakes, trimming interest rates, along with the central bank, banks, mutual funds and brokerages increasing stakes in stocks and vowing to hold these stakes for at least a year. The Shanghai Composite responded with a pair of volatile rebounds of 5.76% on Thursday and 4.54% on Friday. The rebound seems encouraging, but it has seen a couple volatile two day rebounds during the slide earlier too, that turned steeply lower again on the third day. This rebound has taken it to the upper trend line of its current downtrend.   Similar controls set in place in China’s markets intended to stem market falls elsewhere have proven ineffective on a historical basis. Similar tactics in the US during the 1929 crash proved to increase loses in those that likely could have provided a sustained market rebound at a higher market low, had they not tried to provide a floor so near the ceiling and then lost the capital needed to provide this rebound. The controls set in place in China could be setting up the same types of losses in those needed for a future rebound there.   If a bottom fails to hold due to these tactics, it is likely to produce a resistance that could provide a ceiling for many years to come. Resistance that established near the 1929 attempted support sent the Dow Jones lower in the 1930 rebound. The Dow Jones failed to retest this resistance again until it started to bump against it in 1951. It then traded flatly against it for three years before finally breaking above it in 1954, nearly fifteen years after the support attempt was made. Other markets have seen similar failed attempts to stem falls that resulted in capping resistances; including Japan’s Nikkei. Market crashes seldom stop until the market reaches undervalued conditions. Attempts to hold them in highly overvalued conditions seems dangerous; especially when it could increases losses in those needed to provide a rebound later. China’s markets therefore still look very risky.   The US markets began to seesaw in the past week. Daily price variances on the indexes increased dramatically during the week, indicating a higher potential for volatility. Rebounds have turned lower at or near moving averages and Wednesday’s dip reached lower closing prices. Daily price action into the gaps higher make it appear the opening gaps higher could again have been met with sellers, while breaks lower appeared to generate few buyers.   The New York Stock Exchange continued to fall deeper below its 200 EMA early in the week. Gaps higher latter in the week narrowed the distance below the 200 EMA, but it finished the week below it. The NYSE had seen rebounds retreat well short of the 13 EMA until Friday’s gap higher broke above it. It retreated off session highs into the close and a finish slightly above the 13 EMA. The 13 EMA made a bearish cross below the 200 EMA during the week.   Dow Jones Industrial Average slipped back below its 200 EMA and the S&P 500 broke below the 200 EMA during the week. Both the Dow and S&P 500 bounced above their 200 EMA in wide gaps at Thursday’s open, but fell steadily after bumping against their 13 EMA to finish below them. Each saw Friday gap higher to start above their 200 EMA and continued moves higher that broke above their 13 EMA. Each retreated off session highs into a close slightly above their 13 EMA.   The NASDAQ and Russell 2000 continued in falls that neared their 200 EMA early in the week. The two had seen rebounds fall short of their 13 EMA until Friday’s rebound was stuffed at their 13 EMA. Both retreated into the close and finished below their 13 EMA.   The numbers of S&P 500 constituents seeing failures at the 200 DMA continues to increase. Wednesday saw 274 of the then current S&P 500 constituents finish below their 200 DMA. This was a considerable increase over the 259 finishing below it during last week’s June 29 lowest finish.   Several constituents made the first breaks below their 200 DMA in six months or longer during the past week and many continued in declines after this break. Several of those that have made recent breaks below the 200 DMA were in the core stocks that had been pushing the index higher earlier. Many of these stocks are arguably highly overpriced; sporting a P/E that is much higher than the index average and a forward P/E above the index’s historical averages, so it seems possible they could see considerable downside in this retreat.   Although the index saw a fairly large rebound off Wednesday’s close into the end of the week, just over half, or 251 of the S&P 500 constituents remained below their 200 DMA at Friday’s close and an increase in the 246 finishes below the 200 DMA a week earlier when the index finished only $0.26 higher. The index saw 278 constituents finish Friday either below their 200 DMA or less than one dollar above it.   The S&P 400 also finished Wednesday with over half of its then current constituents below their 200 DMA. The close saw 203 of that index’s constituents finish the session below their 200 DMA. Eight more finished less than $0.20 above their 200 DMA. Many of the stocks that finished narrowly above their 200 DMA have a 200 DMA that is in decline.   The number of S&P 400 constituents finishing below the 200 DMA fell to 189 on Friday, but 201 either finished below or less than $0.25 above it. The index also finished Friday with 226 either below or less than one dollar above the 200 DMA.   The S&P 500 continued to evolve as two more changes were made in the past week due to mergers. After being taken private by 3G Capital and Berkshire Hathaway (BRK/B) in 2011, Heinz returned to the S&P 500 after completing its merger with S&P 500 constituent Kraft Food Group, Inc. (KRFT) last week. The combined company began trading publically Monday and changed its name and symbol to the Kraft Heinz Company (KHC).   S&P 500 constituent Dollar Tree Inc. (DLTR) completed its acquisition of S&P 500 constituent Family Dollar Stores Inc. (FDO). As a result former S&P 400 constituent Advance Auto Parts Inc. (AAP) took Family Dollar Stores place in the S&P 500 at the close of trading on Wednesday.   There is a lot of hype over M&A activity as a reason for stock prices to move higher. Both of the mergers above look like they could do well long term, but at the same time the prices paid for the companies in these mergers appears to have made the stocks look pricey at this time.   Care should be taken investing in M&A activity. Many of the deals being made now could turn sour in the future as many companies are being bought at high premiums. M&A activities near market lows usually produce deals at a discount and are usually better investment opportunities. Those near market highs often produce large write offs later as companies realize they paid too much for these purchases. A recent example of this can be found in Microsoft (MSFT) as they wrote off a $7.6 billion loss on the year ago $9.5 billion purchase of Nokia in the past week. That purchase price included $1.5 billion of Nokia’s cash, making the write off nearly a complete washout for shareholders.   The past week’s news likely left a couple of questions for investors. How did Nokia have $1.5 billion in cash, if they could not make money? Why did Microsoft lose money when Nokia was not? It seems likely Microsoft lacked the resources and expertise to manage them properly. They have swallowed up dozens of companies that they have done little or nothing with since. Why would any investor want them buying anything else?   Spinoffs, splits and sales of non-core assets near market highs make much more sense than mergers and acquisitions. Microsoft could spinoff three or four companies that would probably each eventually be worth much more separately, than the stock is as a whole now. Microsoft has become too large to grow earnings at a rate that will increase its stock price at a high rate, even if they continue to purchase expensive companies, but in smaller pieces this growth could be reignited.   The S&P 500 constituents saw a current year earnings increase of $7.22 during the past week. As expected, the increase was partly due to earnings projections becoming available for the three additions in the previous week that did not yet have projections at last week’s update, along with a large increase when Advance Auto Parts current year earnings replaced Family Dollar. Even though a fairly large earnings increase was seen week over week, the changes also resulted in a small increase in the TTM P/E and forward P/E, so the result of the changes actually made the index slightly more expensive. During the week there were 97 constituents that saw decreases in current year earnings projections and 66 saw increases. Five of those that have already reported earnings saw increases while two saw decreases.   The current quarter earnings expectations for those yet to report saw a decrease of $0.16 from the previous week’s estimates. The decrease seen in the current quarter projections continues to be smaller than those seen during the previous two quarters.   Indicators   The featured and supporting indicators discussed below are not always correct, but they have been many times. Being so they are worth reading about and taking note of.   The 100 L, –/(+) 90 D, (-)/(+) 90 D, +2% H, -2% H and 90 E indicators are currently active. See a more detailed description of most of the indicators developed through research and featured in these articles here.   The S&P 500 reached a new lowest close in the significant retreat during the past week. Although Wednesday’s retreat did not reach the 2% required for a volatile drop, the index saw a large retreat into a close of 2046.68. This lower close increased the depth of the current significant drop to 3.95% below the May 21 highest close of 2130.82.   Monday started the week with a gap lower to open at 2073.95, but rebounded to cover this gap at a high of 2078.61 and fell to a low of 2058.40 before finishing at 2068.76. Tuesday began the session higher at 2069.52, but fell to a low of 2044.02 before rebounding to a high of 2083.74 and finishing at 2081.34. Wednesday started with a gap lower at the session high of 2077.66 and continued to a low of 2044.66 before finishing at 2046.68. Thursday gapped higher to the session low of 2049.73 and continued to a high of 2074.28 before finishing at 2051.31. Friday gapped higher again to the session low of 2052.74 and reached a high of 2081.31 before slipping lower to finish at 2076.62.   The index left an open gap lower on Wednesday, although Friday’s high was only $0.01 from filling this gap. It also left two open gaps higher on Thursday and Friday although it seems likely these gaps were larger than the official open would indicate. Open gaps are likely to be filled at some point. Many of the constituents that had these opening gaps also left them open.   The Index continued to fail at the 13 EMA until Friday’s session pushed above it, but it fell into the close to finish only slightly above it. At this point this move is considered neutral. If the index can hold and continue to move above the 13 EMA, it would be bullish whereas a fall below it would be bearish. The index saw two rebounds from session lows during the week within the 2035 to 2055 MRL that were near but above previous support near 2040. This is a bullish indication. As long as previous support near 2040 is not breached, even briefly, it will likely continue to be support. Once broken, a fall below it is very likely to see the level turn into a daunting resistance. The late week gaps higher saw little upward movement afterwards and appeared to lack support, this is bearish. The open gaps left in the index and many constituents are also potentially bearish. The index saw a widening range of daily price variations, this shows the potential for volatility is increasing and is also bearish.   The S&P 500 is near oversold conditions, but a rebound from oversold conditions is not a given. Constituent charts show many are in potentially bearish failures and several that broke from long runs slipped below their 200 DMA during the past week. Stress in overvalued stocks that have pushed the index higher appears to be increasing as downward pressure builds.   The –/(+) 90 D indicator that became active on Feb 26, 2015 expired after Tuesday’s close. It finished its active period as follows in the standard format: highest close / lowest close / final close.   +0.95% / -3.34% / -1.39%   The 90 D that became active on Feb 26 did not perform as expected. Although two significant retreats were seen from resistance in the upper half of the 100 L during its presence, neither retreat reached the depths that seemed possible before this indicator expired. The index increased its highest close less than 20 points during its active period. Several of the projections made for this indicator appeared to hold some merit, however overall the projection was incorrect.   The (-)/(+) 90 D that became active on May 22, 2015 appears to have bearish potential. It has performed as follows to this point in the standard format: highest close / lowest close / last close.   +0.80% / -2.88% / -1.46%   The -2% H and +2% H indicators failed to provide a correct indication in the past week. Volatility indicators increased in the past week and remain at levels that suggest the potential for volatile market moves are much higher than normal.   The average daily volume decreased 0.20% below the previous week. The highest volume was seen during Tuesday’s session and lowest on Friday. The five day volume variance dropped 22.24% to finish the week at 45.47%. The five day volume variance fell to more or less neutral levels. Wednesday’s large retreat again failed to reach levels that are normally seen during capitulatory sell offs making a further retreat seem possible.   Current Cautions   The S&P 500 again saw well over half of the constituents fall below their 200 DMA after Wednesday’s close, with several of them breaking below the 200 DMA for the first time in more than six months. The S&P 400 also saw over half of its constituents slip back below the 200 DMA. As a result, 477 of the 900 largest publically traded companies finished below their 200 DMA at the Wednesday close. Even though the S&P 500 index price rebounded from those lows to just below the previous week’s finish, over half of the constituents remained below their 200 DMA. Large numbers of stocks have a 200 DMA that is trending lower, including some that finished Wednesday slightly above it.   The Greeks resoundingly defeated the referendum on terms for a continued bailout on Sunday. The election results gave Greek leaders the upper hand in negotiations; but they appeared to immediately cower and submitted terms much like those refused by voters. If a resolution is made without addressing the real problems, as news of the proposed bailout suggests, it is likely to resurface again later. It seems likely it could be much worse then. It also seems it could resurface during a time much less favorable to deal with it. Unlike now, it really could be a contagion then. Europe has a limited amount of time to take care of its problems, and despite the current conditions that make some of them seem solved; they did not fix any of them.   Several potentially bearish indicators are active. Volatility indicators edged higher and continue to suggest a much higher than normal chance of volatile market moves still exists.   Intraday action after the late week opening gaps in the major the US indices appeared to be met with sellers. All saw opening moves higher that failed within the first ten minutes and aside from these opening moves, the indices saw less than three hours of positive producing movement higher in two full sessions. Of course there were other rebounds, but they only recaptured a portion of the earlier session loses before turning lower again. These gaps higher appeared to lack support and this puts a continued move higher in doubt.   At the same time chart formations in world indices became very unnerving. Many of the indexes are showing traits that make further retreats seem likely. Rebounds seen in some of these indices were neither fundamental nor technically supported, but instead due to trading controls and influxes of capital that is not limitless to prevent further retreats. These rebounds appear to have reached upper trend channels.   China’s Shanghai Composite Index saw two days of volatile rebounds after falling over 30% lower in the previous three and a half weeks. The rebounds occurred after several control measures where installed to prop the still highly overpriced market up. They threw a lot of money at the problem, but compared to just one week’s loses in the downturn, it was a drop in the bucket. It looks like they may have fired all their guns and may have no dry powder left in reserve if things suddenly turn sour. It seems possible the measures taken could have locked many of those they needed to provide a rebound later into potential long term loses. If their markets should turn lower again, much of the capital needed for this rebound will evaporate. As a result a downturn could provide a capping resistance in these indexes that could last for very many years to come. Markets normally fall to undervalued conditions in market crashes. Many have tried to stop market crashes at highly overvalued levels in the past without success. History tends to repeat itself.   Despite claims otherwise, there are no underpriced markets left in the world. A very long period of near zero interest rates worldwide has sent investors in search of higher yields and as a result has sent world stock markets to prices well ahead of earnings potentials in all markets. The US markets are near historical P/E highs and most world markets are much further overpriced than the US, even after the very large downturns already seen in many of these markets.   Foreign markets generally fall much further than the US market in retreats; making investments abroad continue to look very risky. Many of the world markets have retreated to correction or crash proportions, yet are still very highly overvalued making continued retreats seem possible. Many of these markets appear stressed. Market failures often begin abroad, before spreading and eventually reaching the US. The US markets are showing signs that many of the stocks that had carried it higher could be beginning to fail and some already have. Although most foreign markets are further overpriced than the US, the US markets are at levels that make them appear overpriced on a historical basis.   Many chart formations from individual stocks to the world indices seemed to be flashing warning signals during the past week. These formations along with past timelines and worldwide stock overvaluations continue to make it seem possible the S&P 500 could see a large retreat before the end of the year, and possibly very soon.   The next likely resistance level above the 100 L at 2100 could be seen at the 2140 to 2160 MRL. Earlier highs on the S&P 500 could have seen the effects of this resistance level, but the index is still within the influence range of the 100 L since it has not yet reached this resistance level. Therefore this resistance is not yet considered active. This resistance appears to have the potential to cause a significant pullback.   Please note there is no established resistance in the MRL levels before the index has reached these levels. Several instances have proven to hold resistance once reached; however MRL levels that the index has not yet reached are only the most likely levels that resistance will be seen based on research. Back tests of the data used to project these resistance levels work well, but they are not always exact, and these resistances could react sooner or later than expected, it is also possible the resistance will not be seen at all.   Data provided for the S&P 500 was derived from the historical daily data tables, similar data can be found at AOL Finance. Earnings information was gathered from Yahoo Finance, CNBC, Edgar Filings, Scottrade Elite, AOL Finance and Morningstar, although other websites, including company websites, may have contributed small amounts of information. Stock and Treasury charts used for analysis and commentary were provided by StockCharts.com, Scottrade Elite or from those that Ron created from his data. Gold charts used for analysis and commentary were provided by Kitco.   Have a great day trading.   Disclosure: Ron currently has investments in MSFT. Ron has no investments in BRK/B, KRFT, KHC, DLTR, FDO or AAP. Ron is currently about 56% invested long in stocks in his trading accounts reflecting a decrease over the past week’s investment level. The decrease was the result of the sale of five issues and dividend payments. Several sales were in small positions in companies at 52 week highs and at levels Ron’s feels they were overvalued at. Current market conditions and chart formations seem frightening. Although he may laugh at himself later, it seems possible the market could turn very sour shortly. He will receive dividend payments from ten issues in the coming week and seven in the following week. If no further investment changes are made during this time frame, these dividend payments would not change his investment level.   Disclaimer: The information provided in the Stock Market Preview is Ron’s perception of the current conditions and what he thinks is the most probable outcome based on the current conditions, the data collected and extensive research he has done into this data along with other variables. It is intended to provoke thought of the possible market direction in his readers, not foretell the future. Ron does not claim to know what the stock market will do. If the stock market performs as expected, it only means he is applying the stock market history to the current conditions correctly. His perception of the data is not always correct.   This article is intended to provoke thought about investment possibilities. Acting on the information provided is at your own risk. You are urged to do your own research, and where appropriate, seek professional investment advice before acting on any information contained in these articles.…