To gain an edge, this is what you need to know today.

The Real Force

Please click here for a chart of ETF () which represents the Dow Jones Industrial Average ().

Note the following:

  • The chart is a monthly chart to give investors a long term perspective.
  • The chart includes the period of the 2008 crash when most portfolios invested in blue-chip stocks lost 50% of their value and those in speculative stocks lost a lot more.
  • The chart shows (in purple) the progression of the Fed’s balance sheet (FBS) in trillions of dollars.  The FBS stood at $0.87 trillion before the 2008 crash.  Now the FBS has risen to $8 trillion.  In plain English, this is a fancy way to describe money printing.
  • Note from the chart the amount the stock market has risen since the March 9, 2009, major buy signal given by the Arora Report.  The signal was given right at the start of the bull market.  This buy signal came after The Arora Report subscribers were protected using signals given in late 2007 to go 100% in cash, hedges, inverse ETFs and short selling.
  • The Fed continues to print money at the rate of $120 billion a month.
  • It is the Fed money printing that has been the major force behind the stock market rise.
  • It is likely that sooner or later the Fed is going to start tapering.  In plain English, this means the Fed will print less money.
  • Long term investors should take some time to study the chart to fully understand the risk in this market.
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Momo Crowd And Smart Money In Stocks

The momo crowd is 🔒 (To see the locked content, please take a 30 day free trial)  stocks in the early trade. Smart money is🔒.

Gold

The momo crowd is 🔒 gold in the early trade. Smart money is 🔒.

For longer-term, please see gold and silver ratings.

Oil

The momo crowd is🔒 oil in the early trade.  Smart money is 🔒.

For longer-term, please see oil ratings.

Markets

Our very, very short-term early stock market indicator is 🔒.  This indicator, with a great track record, is popular among long term investors to stay in tune with the market and among short term traders to independently undertake quick trades.

Interest rates are ticking down and bonds are ticking up.

The dollar is slightly stronger.

Trading futures is not recommended for most investors. The purpose of providing this information is to give an indication of the premarket activity that usually guides the activity when the market opens.

Gold futures are at $1775, silver futures are at $26.20, and oil futures are $73.82.

S&P 500 futures resistance levels are 4318 and 4400: support levels are 4200, 4000, and 3950.

 futures are up 12 points.

Protection Bands and What To Do Now?

It is important for investors to look ahead and not in the rearview mirror.

Consider continuing to hold existing positions. Based on individual risk preference, on dips, consider holding 🔒 in cash or treasury bills or short-term bond funds or allocated to short-term tactical trades and short to medium-term hedges of 🔒 and short term hedges of 🔒. This is a good way to protect yourself and participate in the upside at the same time.

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You can determine your protection bands by adding cash to hedges.  The high band of the protection is appropriate for those who are older or conservative. The low band of the protection is appropriate for those who are younger or aggressive.  If you do not hedge, total cash level should be more than stated above but significantly less than cash plus hedges.

PLEASE NOTE: UPCOMING CHANGE IN FORMAT AND EMAIL SERVICE PROVIDER

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.  When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks.  High beta stocks are the ones that move more than the market.