The Elliott wave model has helped investors catch market turns for eight decades. As Frost & Prechter’s Wall Street classic book, Elliott Wave Principle, says: The Wave Principle is the best forecasting tool in existence. [It] imparts an immense amount of knowledge about the market’...

Quick take: At the end of May the inflation-adjusted S&P 500 index price was 99% above its long-term trend, unchanged from the previous month. About the only certainty in the stock market is that, over the long haul, over performance turns into under performance and vice versa. Is there a patte...

Here is the latest update of a popular market valuation method using the most recent Standard & Poor’s “as reported” earnings and earnings estimates and the index monthly average of daily closes for the past month. For the earnings, see the table below created from Standard &am...

How can a company that is going to generate $2,000,000,000 in negative free cash flow in 2017 be worth 70 billion dollars?  Netflix has soared in popularity in recent years, but so have their financial losses. Just like during the original tech bubble, investors are ignoring basic fundamentals and...

With the markets closed on Monday, there really isn’t much to update you on “technically” from this past weekend’s missive. The important point, if you haven’t read it, was: “The failure of the market to rotate to the “risk on” trade should not be lightly dismissed.  A healthy brea...

Gravity eventually overpowers financial fakery. When debt-asset bubbles expand at rates far above the expansion of earnings and real-world productive wealth, their collapse is inevitable. The Supernova model of financial collapse is one way to understand this. As I noted yesterday in Will the Crazy ...

Housing is hot again, but lately it’s been overshadowed by flashier bubbles in government debt, tech stocks and possibly cryptocurrencies. Still, the warning signs are spreading. Today’s Wall Street Journal, for instance, reports that homeowners are back to using their houses as ATMs: Homeowner...

If everything is going to be “just fine”, why are so many big names in the financial community warning about an imminent meltdown?  I don’t think that I have seen so many simultaneous warnings about a market crash since just before the great financial crisis of 2008.  And at this point, you...

There are multiple sources of friction in the Perpetual Motion Money Machine. We’ve been playing two games to mask insolvency: one is to pay the costs of rampant debt today by borrowing even more from future earnings, and the second is to create wealth out of thin air via asset bubbles. The t...

Over the last couple of months, I have repeatedly discussed what has been possibly the most “boring” market ever. That was until the previous Wednesday when the market deciding to take a quick “road trip” to the 50-dma.  It didn’t last long. The market promptly went back to sleep in a lig...

Breadth is one of the most powerful tools available to investors and can be used to measure the health of any stock market or economy. Simply put, it is a measure of the level of participation of stocks in a bull market or, in terms of an economy, the number of regions or states participating in an ...

In this past weekend’s newsletter, I discussed the fact that despite the bullish “exuberance” of market participants, the underlying internal deterioration has continued. To wit: “Furthermore, the underlying internals have continued to weaken over the last week which has remained a concern ...

Bitcoin has been rocketing higher lately, as it gains widespread official approval and more people figure out how to use it. As the first of its kind to emerge, bitcoin has become synonymous with “cryptocurrency”. But lately it’s been joined by a lot of others – which together now account f...

In this past weekend’s newsletter, I discussed the fact this market has been “nothing short of boring” as of late, but remains on a “bullish buy signal” currently. To wit: “Importantly, the ‘buy’ signal that was registered in late April is very close to tripping a short-term sell s...

Note: This update incorporates the latest monthly close and the GDP Q1 Advance Estimate data. Market Cap to GDP is a long-term valuation indicator that has become popular in recent years, thanks to Warren Buffett. Back in 2001 he remarked in a Fortune Magazine interview that “it is probably...

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...