Outlook April 27

Downside action is very mild so far.
The Nasdaq successfully kept above the 2450 level.
The market is even attempting at new highs again.
We may still get a sudden drop this week, with Full Moon coming tomorrow.
But chances are increasing that this rally will continue into mid-May.

Why are the stocks so resilient?
Well, it takes sellers to drive prices down.
The problem is this: when somebody sells his stocks where he is going to put the money?
In the bank it earns zero interest, in bonds one is at risk of rising interest rates, and real estate still doesn’t look very healthy either (plenty of oversupply, and also at risk of rising mortgage rates).
Gold is doing pretty well, but few people want to put all their savings in gold or silver.

So basically, people who own stocks stay into stocks by lack of any good alternatives for the moment.
And this means the stock market goes on creeping higher, because all it takes is a few traders who cover shorts, or some scared investors who gradually re-enter the market after the 2008 crash.
This can go on for quite a while, till stocks are way overvalued again.
This also means it is becoming increasingly dangerous, and we may see a very sudden drop some time this year or next.

All the current government interference in the economy, artificial low interest rates, the “borrowed recovery”,.., risks creating an even bigger monster than the one they claim to have slain.

The stock market is at its most dangerous whenever it appears very safe and stable.
So watch out.

Good Luck, Danny

Outlook 19 April

Looks like we got our peak last Thursday.

A Nasdaq drop below 2450 would confirm the probable end of this move that started last February.

Expecting more downside pressure on stocks for the rest of the month.

Initial downside targets for Nasdaq are 2300 and next 2200.

Regards,   Danny

Outlook 12 April

The markets have climbed and are sitting right at the resistance levels we mentioned last week.

The question now becomes whether we can break decisively above these resistance levels, and then stay above…?

Wouldn’t surprise me if the New Moon on Wednesday brings a peak, followed by downside action for the rest of the month.

This is setting up to become a good chance to use the lunar cycles in combination with trend lines, an approach we describe in the Lunatic Trader ebook.

Good Luck,  Danny

Geomagnetic Storm

There was a geomagnetic storm yesterday, the second one of this year.
(See what it means on our site: http://lunatictrader.com/?Geomagnetic_Storms )

The previous one came in January, just at the onset of a 10% decline in the markets.

We may be in for a similar scenario now. The recent rally is getting long in the tooth, and both Nasdaq and Dow Jones index are only just below overhead resistance from a long term trend line.

Here is the chart for Nasdaq:

At about 2450 there is strong resistance (11000 for the Dow Jones, 1200 for the S&P 500).

Any failure to break above these levels will probably lead to a sell-off that takes us below the uptrend line that started in early February. In that case we are likely to see the Nasdaq back at 2300 by the second half of April, when we will have a Full Moon period.

Stay tuned, Danny

Software available

It has taken somewhat longer than estimated (mainly because of personal events), but the Lunatic Trader software is finally available for download.

The good thing is that it has given us time to add more materials, and in the past months you have been able to see on this blog how we work with the lunar cycles in real time.
If you now take the program along with our weekly posts, you can easily see how we made the weekly calls.

The program displays all lunar cycles from the year 1900 till 2100 (in registered version), so you are free to study how it would have done in the past.
People who register the program also get a special ebook manual with my personal strategies for using these cycles as well as a collection of great historic examples.
After studying it you will have a new perspective on market movements.

Just go here: http://LunaticTrader.com

Cheers,   Danny

Outlook 5 April

Stocks turned in another flat week and now we are going into the New Moon period, a more positive period for stocks.
The market showed resilience over the past two weeks, so we are likely see a new push higher over the coming days.
Thursday will give us a Lunar Distance Extreme, and next week we will have a New Moon.
Good chances that we will make some kind of top around those days.

Stay tuned, Danny