We’re Once Again In A Bull Market

Trader Scott’s Market Blog

Although Donald Trump is no Ron Paul, I am getting a chuckle from his refreshing non-PC comments. 3 observations – every establishment politician on this globe is against him, all of Wall Street is scared of him, and the list of whining celebrities who claim they’re leaving the country is growing. There isn’t a better endorsement than having these 3 groups against him. And there is nothing a Pres. Trump can do that will alter the bull market in gold. Because of the quadzillions in debt, anything attempted to rein that in will cause a leak somewhere else that will blow up.

On to markets – from 2011 while the US Dollar permabears kept claiming that commodities were going to soar, the exact opposite happened. During this time, I repeated continuously that commodities were in a major bear market and wouldn’t bottom until March 2016. And it’s almost like the boys are listening to Real World of Money, because right on cue, one commodity after another has bottomed right on schedule and are beginning to spike higher. Agriculture, especially, is extremely bullish. And full disclosure, I own an agriculture ETF (symbol RJA). However, expect another selloff in commodities later this year, which would be the next great buying opportunity.

As to stocks – from April 2009 until Sept. 2015, I monotonously repeated to ignore all the folks who were claiming that stocks are about to crash and I said to just keep buying into all of the selloffs, because stocks were in a powerful uptrend, i.e. – bull market. However in the update from last Sept., I said that it’s time to short the stock market as the bull market is now over. Then in the outlook this past January, right into the lows when everyone was freaked out, I said that it was time to cover those short positions and to go long for a big rally, however, keeping in mind that it’s only a rally in a bear market. And I specifically said that there’s even a chance to eke out a new all time high, which the Dow did do. Since then there has been a very powerful rally, and of course now, I’m getting lots of people telling me that I’m wrong about the stock market. Maybe they’re right, but I’m looking for the technical excesses to begin shorting stocks again, because I continue to be bearish on stocks. My outlook is that this intermediate term stock bear market will not end until late 2016 at the earliest. What’s kept me in this business so long is understanding and respecting risk – so do not focus on the reward potential, but on the real risk at hand. Even though, the reward potential in stocks in the long term is huge, for right now, so is the risk.

And to gold – that last sentence about risk and reward explains why from Sept. 2011 to Sept. 2015 I was so cautious about gold, even though I’m very bullish about gold long term. During the 51 month bear phase we needed to see big capital move aggressively to accumulate gold which eventually they began doing and they are continuing to do. That is what rebuilds the forces needed to strengthen the market and push gold much higher over the next many years. This is once again a bull market, so the advice is the same as the Dow from 2009 – 2015. Ignore everything and everyone, including me, if I’m bearish short term – just be patient and wait for the selloffs and buy into the weakness. Understand it’s the long term that you’ll make the money, but it’s the very short term which provide the lowest risk entry points. And lastly, I’ve mentioned this twice in the last 4 months – while I’m very bullish on gold over the next 25 years, I’m wildly bullish about silver, the mining shares and numismatics. Andrew will be a billionaire before this long term cycle is over. But please, understand and respect risk and only buy into weakness.

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