Deterioration in the credit markets increases the probability of lower prices ahead with a cautious stance toward equities warranted as financial stress remains elevated. Junk bond credit default swap spreads (red line, bottom panel) are blowing out to their highest levels since 2012. Investment gr...

I think we are replaying the general market correction process similar to 2011. Back then the concern was over Europe, which represents the single largest economic region in the world, and this time around it’s China. Notice the S&P’s similarity between today (in black) and 2011 (in red)...

Gold has lapsed deeper into pariahdom this year, becoming the most-hated investment class in all the markets.  Traders are avoiding it like the plague, utterly convinced gold is doomed to spiral lower perpetually.  But this wildly-bearish psychology is dead wrong.  Financial markets are forever c...

Every dictator knows that a continuous state of emergency is the best means to justify tyrannical policies. The trick is to keep the fictitious emergency from breeding so much paranoia that routine activities come to a halt. Many have discovered that its best to make the threat external, intangib...

The U.S. housing market may be about to implode — again. Before I get into the “why,” know that the residential real estate market never fully recovered. Annualized new home sales this past July stood at 507,000, vs. the July 2005 peak of 1.39 million. The chart and commentary from...

Not only did the Fed vote to keep interest rates stable yesterday, it did so overwhelmingly — with just as many members apparently favoring lower rates as higher. Now all the people who bought the “rate normalization” promise/threat are backtracking. From today’s Bloomberg: Expecting a Fed ...

Yesterday’s Fed decision was one of the most anticipated ever, with much potential to really change the global financial-market dynamics going forward.  But thanks to the Fed’s incredible market distortions of recent years, Fed meetings spawning exceptional volatility is nothing new.  Fed deci...

The New York Stock Exchange publishes end-of-month data for margin debt on the NYXdata website, where we can also find historical data back to 1959. Let’s examine the numbers and study the relationship between margin debt and the market, using the S&P 500 as the surrogate for the latter. T...

Silver has had a rough year, slumping to major new secular lows.  After sliding on balance for years now, even the diehard silver bulls are losing faith in their metal.  But despite its vexing slumber, silver’s price-appreciation potential from today’s levels remains enormous.  Between radica...

Technical versus fundamental analysis? The winner is… Editor’s note: You’ll find the text version of the story below the video. Technical versus fundamental analysis: Which approach yields better investment results? A new study by three finance professors offers an answer. The ...

Price volatility in stocks and other instruments has been stunning the past few weeks. The VIX chart from the August 28 Elliott Wave Short Term Update puts the massive moves in perspective: Short Term Update editor Steve Hochberg writes: “This chart of the 5-day percentage change in the CBOE ...

There is a growing sense across the financial spectrum that the world is about to turn some type of economic page. Unfortunately no one in the mainstream is too sure what the last chapter was about, and fewer still have any clue as to what the next chapter will bring. There is some agreement however...

Here is a summary of the four market valuation indicators we update on a monthly basis. The Crestmont Research P/E Ratio (more) The cyclical P/E ratio using the trailing 10-year earnings as the divisor (more) The Q Ratio, which is the total price of the market divided by its replacement cost (more...

Stocks and oil weren’t the only markets going berserk last week. Eurodollar, or EURUSD — the world’s biggest and most popular forex market — first rallied 700+ points (or pips) higher and then crashed about 500 pips back to earth, all in a matter of a few days. Watch this new...