The bull market is back at full strength… Back in November of last year, I talked extensively about a market breadth indicator called the advance-decline line (AD line) — a technical-analysis tool that charts the number of advancing stocks minus the number of declining stocks. This indicator is a telling sign of what’s going on beneath the surface.  For instance, if the market is hitting new highs, you would look at this indicator to make sure it, too, was advancing and hitting new highs. This would show strong participation in the market and confirm the bullish trend. However, if the… Read More

The bull market is back at full strength… Back in November of last year, I talked extensively about a market breadth indicator called the advance-decline line (AD line) — a technical-analysis tool that charts the number of advancing stocks minus the number of declining stocks. This indicator is a telling sign of what’s going on beneath the surface.  For instance, if the market is hitting new highs, you would look at this indicator to make sure it, too, was advancing and hitting new highs. This would show strong participation in the market and confirm the bullish trend. However, if the AD line fails to keep pace with the underlying index, this is a sign of weakness in the market, signaling a bearish divergence. In my original discussion, I pointed out that the AD line revealed a bearish divergence in late September. A week later, the market selloff began and didn’t let up until December 24.  I touched on this indicator once again in late January, along with another one — the Coppock Curve. These two indicators, along with my Maximum Profit system, were showing bullish characteristics.  We took those bullish signals and loaded up on stocks… and we’ve been nicely… Read More

My young boys ask a lot of questions. I know this isn’t unique. Almost all young children ask questions. And after a while, almost all those questions become extremely repetitive and, in all honesty, annoying. But I’m sure I’m not the only parent who has faced a long stream of “why” questions, which is currently among the favorite questions of my little guys. I patiently answer their questions as many times as they ask because I have found myself in their situation at times. We all have. After all, “Why?” could be among the most important question we ask as… Read More

My young boys ask a lot of questions. I know this isn’t unique. Almost all young children ask questions. And after a while, almost all those questions become extremely repetitive and, in all honesty, annoying. But I’m sure I’m not the only parent who has faced a long stream of “why” questions, which is currently among the favorite questions of my little guys. I patiently answer their questions as many times as they ask because I have found myself in their situation at times. We all have. After all, “Why?” could be among the most important question we ask as investors. —Recommended Link— Your Chance To Learn From The Best Do you want to make up to $4,000 each week in the stock market in only about 10 minutes per week? Stock expert Jim Fink is holding a new LIVE, free training where he’ll reveal his 3 secrets behind his #1 investing strategy for 2019. Join him February 27th at 1:00 P.M. Eastern to learn how to make easy money each week selling stock insurance to nervous-Nelly investors. Spots are limited — Click here to register for free. This week, I want… Read More

There’s an old saying that trees don’t grow to the sky. In other words, there is a natural limit to growth. In the case of a tree, maybe the tree’s structure makes it impossible for nutrients to reach above a certain height. As with so many sayings, this one is often applied to the stock market. For example, companies cannot continue growing earnings at 100% per year forever. There is a natural limit to a company’s growth. The same is true for stock prices. I think of this old saying whenever I see a long streak of up or down… Read More

There’s an old saying that trees don’t grow to the sky. In other words, there is a natural limit to growth. In the case of a tree, maybe the tree’s structure makes it impossible for nutrients to reach above a certain height. As with so many sayings, this one is often applied to the stock market. For example, companies cannot continue growing earnings at 100% per year forever. There is a natural limit to a company’s growth. The same is true for stock prices. I think of this old saying whenever I see a long streak of up or down closes. In the chart below, you can see that the S&P 500 has closed higher for eight weeks in a row.  This is not unprecedented. There have been 30 previous instances when a streak lasted at least eight weeks. The longest winning streak on record is only 12 weeks.  So, we know the current streak will end. But what does history tell us about this scenario? When is it likely to end? And what happens after that? To help answer that question, I ran some tests to see what’s happened in the past. The results are summarized in the table… Read More

Value investing is one of the most popular investment strategies used today by individual investors and portfolio managers.  Value investors seek out stocks that can be purchased at a discount to a company’s “real” worth. It’s an approach that’s been refined over the years, but its foundation goes back roughly 85 years with the publishing of Benjamin Graham and David Dodd’s college textbook, “Security Analysis.” Benjamin Graham is properly credited as one of the fathers of value investing. Disciples of his include such notables as Warren Buffett (who is reportedly the only student to receive an “A” in his class),… Read More

Value investing is one of the most popular investment strategies used today by individual investors and portfolio managers.  Value investors seek out stocks that can be purchased at a discount to a company’s “real” worth. It’s an approach that’s been refined over the years, but its foundation goes back roughly 85 years with the publishing of Benjamin Graham and David Dodd’s college textbook, “Security Analysis.” Benjamin Graham is properly credited as one of the fathers of value investing. Disciples of his include such notables as Warren Buffett (who is reportedly the only student to receive an “A” in his class), Walter J. Schloss, Seth Klarman, and Bill Ackman. Graham’s approach was to identify stocks that were trading at a discount to their intrinsic value. And although Graham never fully explained how to determine “intrinsic” value for a stock, we do know that he felt a firm’s tangible assets were a particularly important component. Other factors included earnings, dividends, financial strength, and stability.  Graham knew that identifying such neglected, undervalued stocks was a protracted and patience-trying experience. But he also knew the rewards could be great. And so did his most famous student…  —Recommended Link— The most powerful market research you’ll… Read More

S&P 500 companies have now posted healthy double-digit earnings growth for five straight quarters — maintaining a 20%-plus pace for a few of those. While the first quarter of 2019 could fall on either side of zero, full-year 2019 profits are expected to climb another 5% over last year’s record levels. In short, it’s been a good environment for dividend growth. That’s exactly what we like to see over at my premium newsletter, High-Yield Investing.  As my premium subscribers know, I keep tabs on companies that are likely to announce dividend hikes in the coming month and share my findings… Read More

S&P 500 companies have now posted healthy double-digit earnings growth for five straight quarters — maintaining a 20%-plus pace for a few of those. While the first quarter of 2019 could fall on either side of zero, full-year 2019 profits are expected to climb another 5% over last year’s record levels. In short, it’s been a good environment for dividend growth. That’s exactly what we like to see over at my premium newsletter, High-Yield Investing.  As my premium subscribers know, I keep tabs on companies that are likely to announce dividend hikes in the coming month and share my findings in regular issues. And while the companies mentioned may not end up being official portfolio recommendations right away, it’s always a good exercise that could eventually lead to another long-term winner. Here are four more prospects likely to reward investors with increased payouts starting next month. #-ad_banner-#1. Air Products and Chemicals (NYSE: APD) — APD is a leading global supplier of industrial gases. The company provides oxygen, nitrogen, and carbon dioxide, as well as rarer gases such as neon and xenon. These products are marketed to many fields including aerospace, food/beverage, metals fabrication, and healthcare. With stronger sales volumes and… Read More

Should I stay or should I go? If you’ve been singing this 1981 tune by the English punk rock band The Clash to yourself since late September, you are not alone.  In the fourth-quarter selloff last year, U.S. equities lost $4 trillion in combined market value. For those who had chosen to stay and not to go, a sharp market bounce has helped recover much of the losses: after the 17% rally off the December low, the S&P 500 has now returned to early January 2018 levels. For the tech-heavy Nasdaq 100, the decline was deeper, but the bounce was… Read More

Should I stay or should I go? If you’ve been singing this 1981 tune by the English punk rock band The Clash to yourself since late September, you are not alone.  In the fourth-quarter selloff last year, U.S. equities lost $4 trillion in combined market value. For those who had chosen to stay and not to go, a sharp market bounce has helped recover much of the losses: after the 17% rally off the December low, the S&P 500 has now returned to early January 2018 levels. For the tech-heavy Nasdaq 100, the decline was deeper, but the bounce was sharper. At its lowest levels of 2018, the Nasdaq was down 23% from its highs. Since its December lows, though, it has rallied some 19%.  As a result, the Nasdaq is now higher by about 10% from its 2017 levels. —Recommended Link— How I hacked the stock market and got away with thousands. Make $30,000 in 2 months exploiting mispriced stocks like Apple, Starbucks and other quality blue chips. Click here for the easy (and legal) secret… Hardly a record, but still better than money-market returns. It Pays To Hold Fast But stocks are risky, you might… Read More