New market records and update on US market status

The US markets hit new all time records this past week and breaking new levels.  The US was one of the best countries (some may disagree) to invest in stocks, housing, industry sectors, some commodities, mutual funds, etc, this year.  Below, i have some indices for some countries.  These indices measure or can tell you how well this country did financially and the US is on the green side for 2013.

Japan Nikkei 225                                     51%
United States S&P 500 Index                    29.11%
Global Index GDOW The Global Dow              24.16%

Russia Market Vectors Russia Index ETF       -4.5%

China Shanghai SE Composite Index           -7.4%
Brazil Bovespa Stock Index                        -15.89%
Peru EPU iShares MSCI All Peru Capped         -28.3%

This year was not a good year for emerging markets such as Brazil, Peru, and China.  Although, China's gross domestic product (GDP) has been a whooping 7% or so, their indices has been pretty bad.  The question is, will the emerging markets turn to the upside in 2014?  They can.... but it's not a sure thing.  As the global index, and US is forecast-ed to keep going up, emerging markets may be able to get on the same ride on the way up.  

Now, this bring me to the reason why i'm posting today.  The US markets may keep rising for 2014 all the way.  The Federal Reserve Bank announced tapering last week (reducing bond purchases and other stimulus) at 10B per month.  They gave a date of expiration until Sept/Oct 2014 and as long as the economy can carry itself.  Since they gave this date and due to other technical analysis (like the Elliott analysis from Caldaro and Vtrader), US markets are very likely to be profitable this Spring and Summer of 2014.

So, the markets won't top early this year as i had suggested (crossing fingers).  The top may come in Sept/Oct when the FED stops buying bonds or if the US markets rally another 15 to 20% against the GDP this year.  A similar bubble happened in 2000 (see graph).


(reference from Vtrader)

This bull markets has been running with positives profits since 2009.  There is no markets in history that runs up and up without a top and drop.  Once this top comes in, a 30 to 50% of market loss is projected.

My trading strategy didn't come as planned.  I finished my 401k at 20.7% up YTD and my broker account is up 15% YTD.  Still, profits are better than nothing.

Merry xmas all and happy new year!

-------

My trading strategy and gains for 2013

401k = 20.7% up YTD 
Broker = 15% up YTD

How do you trade?

I get this question several times.  How do you trade?  How does it work?  It is very simple.  No science to it.  It is just a simple way like buying a car or a house.  When you want to buy a house or car you buy for the lowest price possible.  You buy at the lowest price so you can use the whatever other money left to buy other things.  The same goes with buying stocks.  You buy low or cheap.  Moreover, when you buy a house, you hope that the price of the house will go up so you can make equity (extra cash) if you sell the house later as the house appreciated in price.  Unfortunately, this does not work for cars most of the time, as they depreciate in value.  But, my whole point is: when you buy stocks, you want to buy them low, until they reach a higher price and then you sell them.  This is how traders play/invest to take profits in Wall Street.

Now, what do you use trade?  You use broker accounts.  All they are doing is helping you be in the middle of Wall Street and you.  Of course, for a small commission.

Is there an edge or a way to know when to buy or sell?  Yes.  It's not 100% but you can stay on the 60 to 80% if you learn how to do it right.  It is said that if you want to be a good trader/investor, you need to win 6 to 8 times out of 10 times.  The other 2 to 4 times are losses.  Now, these losses have to be good losses.  I mean, that if you start seeing a loss on your buy, you get out if your loss hits your stop loss (read Richard Wycoff for more info).

When i make my decisions to buy and sell, i use Elliot Wave theories to guide me through the stages of the markets.  I read volumes to see how much traffic of purchases are trading.  I check Europe and Asia periodically as they can affect the US markets and viceversa.   Fibonacci retracements are great guides too as they can help estimate the course of a trend together with RSI (Relative Strength) and MACD.

Anyway, you can keep going and talking about this stuff.  In regards to my trades, i sold all my BOIL shares for a nice profit to buy me coffee for 6 months.  The next day, it went up to 8.5% and i could have double my wins.  Today is up a little.  Oh well.  You can never win all.

I'm on UGL (Double Bull Gold ETF) as i'm speculating for Gold to go up.  Also, I bought some Double and Triple Bear ETF against the US markets.  I'm hoping for them to decline and crash.  But, it's a tough call as the Long Term trend is up (Bullish).


Laters


My trading strategy and gains:

401k = 20.4% up YTD (0% invested - waiting for drop to past).  Projection by end of year is 24%
Brokerage = 15.3% up YTD (10% invested on S&P double and triple short ETFs and Gold double long ETF) Projection by end of year is 23%