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Wedging Out to Break the Downtrend 5/26/22

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2 hours ago, Jorma said:

Well maybe QT will end in June. Why wait for trouble?

8% inflation is big trouble. 

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25 minutes ago, sandy beach said:

Fed minutes yesterday said participants believed we will still have a 2.8% GDP growth year. Kyle Bass says this morning "That's just not going to happen!" A lot of folks want to pretend we can end inflation without pain. It simply isn't possible. Quantitative tightening is going to be painful if they really want to crush inflation. It was painful in the early 1980s and it'll be painful again this year unless they just give up on their inflation mandate and prop up leveraged asset prices.

This is the choice they're facing. I think it's binary. Can have one or the other. Not both or neither. 

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3 hours ago, DrStool said:

Now looks more like 4070. There's also a trendline there. 

I'm on a hot streak. 

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5 hours ago, DrStool said:

Last time my chart pick list had a near10% gain, the market reversed. So this time, I tightened the trailing stops to protect the gains. So far, so good. 

image.png

Percentage based on 100% cash, no margin, no options. Boring. Sorry. 

9.4% on a 2 week average holding period? Am I allowed to project compounding?

No. 😄😄😄

Even Steven in This Week’s Swing Trade Screens

Energy stocks are surging. The list is now +10.2%.

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ON THE OTEHR SIDE OF THE WAVE

The 40% M2 print from March 2020 onwards was a varitable tsunami of money.

It pushed stocks and bonds and houses way above reasonable values.

Since the start of 2022 we have been "on the other side of the wave"

Going down.

The retailers are surfers on the wave.

We have not reached the bottom yet. 

But there will be rallies!!!!!!

Take Costco for instance

Sells for 37 PE and 40 times free cash flow.

Clearly worth about 100 B NOT the 200 B it is currently valued at.

So many of the large cap stocks still have significant PONZI values in their stocks that need to be burned away.

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