For more than a century, the stock market has demonstrated a knack for climbing the proverbial wall of worry. Despite a laundry list of headwinds, including recessions, depressions, wars, historically pricey valuations, and high inflation, the iconic Dow Jones Industrial Average (DJINDICES: ^DJI), broad-based S&P 500 (SNPINDEX: ^GSPC), and technology-inspired Nasdaq Composite (NASDAQINDEX: ^IXIC) have all motored to new highs.
But when the lens is narrowed to a shorter time frame, say a few years, the outlook for equities becomes far murkier.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
Just as history shows that patience is handsomely rewarded on Wall Street, it can serve as a warning over shorter timelines when one or more red flags crop up. Right now, we're witnessing the stock market do something that's only occurred four times over the last roughly three decades -- and the previous three instances all ended poorly for Wall Street and investors.
The easiest drum to beat on Wall Street at the moment is stock valuations. In early June, the S&P 500's Shiller Price-to-Earnings Ratio reached 42.84, marking the second-priciest valuation when backtested to January 1871. However, premium valuations may not be the stock market's most immediate red flag.
#signal #time
But when the lens is narrowed to a shorter time frame, say a few years, the outlook for equities becomes far murkier.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
Just as history shows that patience is handsomely rewarded on Wall Street, it can serve as a warning over shorter timelines when one or more red flags crop up. Right now, we're witnessing the stock market do something that's only occurred four times over the last roughly three decades -- and the previous three instances all ended poorly for Wall Street and investors.
The easiest drum to beat on Wall Street at the moment is stock valuations. In early June, the S&P 500's Shiller Price-to-Earnings Ratio reached 42.84, marking the second-priciest valuation when backtested to January 1871. However, premium valuations may not be the stock market's most immediate red flag.
#signal #time
10 days ago
