Came across the chart of GE in 1929, it drops from $400 in 1929 to $20 in 1932, looks like the chart of YH:eek: :eek: !! Funny how the more things change the more they say the same. My predictions since I can always change my screenname if Im wrong. The September lows will hold for all major indexes. The market is not as bad as it looks. On 10/28/87 the average PE of all stocks with earnings was 10.6. But, the dividend average was 3.7% for all stocks that paid dividends. Now we have a PE of 19.4, but the dividend average is 1.8%. So the dividend is priced into the stock, but over the next 10 years I would expect the averages to flip back as people will want to see some proof that companies are earning money. Also on the technical side: Copper, Transports and Many industrials are breaking out to new highs. Not to mention some emerging markets like Malaysia, Singapore, South Korea, and Mexico are all making yearly highs. To me this means that a recovery is coming, but I don't think the major price action will be in tech. Regards
trd- I'm all for watching the transports as a leading indidcator too(only as an investing tool, not daytrading) but you call this moving to new highs?(see chart)
Maybe you can tell me how you post the PDF files? XLY is the dow transportation average. Also a lot of Truckers are showing up in my daily scans. And I agree, the transports are not much of a use for day trading, nor are fundamentals. Just my predictions based on the longer term view. And I forgot to mention my father indicator. About a month ago we were discussing the probability of a retest, he said no way. Yesterday we discussed him dumping all his stocks before the big slide. Can only mean rally!! Regards,
I got curious and looked up the components of XLY, and although it is called Cyclical/Transport, it's biggest holdings are WMT and HD, so go figure. I just assumed that it tracked the transports. On to a more positive note, I looked at TC-2000 MG772-Regional Airlines, MG774 Air Delivery, and MG775 Trucking. All are looking pretty nice. One question uptick, in addition the the saving of charts. Do you know using TC-2000 if I can overlay several of these Industries on a single long-term chart? Thanks
Markets gonna go significantly anti-positive Friday or Monday. There was a huge amount of unloading going on today and Tuesday. Especially today.
I don't have a strong opinion on valuation, and I am not disagreeing on that matter. I just feel the argument with P/E and Dividends is incorrect. The "E" in P/E is INCLUSIVE of dividends. Why should a different dividend yield change that? The relationship is not simple, but I admit there might be something. It is just not obvious to me right now.
trd- I only used TC2000 on a trial basis about a year ago so I don't really know too much about it...but I'm sure you can find an answer to your question at : www.tc2000.com uptik2000
You are correct sir, and I do agree with you about the earnings. My thought is this, pre 90s about 1/2 of the return figure you see for markets reflects dividends paid. And 1 of the older technical models had you sell stocks with the yield dropped to 3%. Now, somewhere along the line, probably due to taxes people started to care less about dividends, meaning companies retained more in earnings thus pushing PEs up and yields down. Now all things being equal, to revert to the 87 lows, the market could fall another 50% and then PEs and yield would be back in line with a major low. I just think the switch will be more gradual, as people will start to look for stability. For my technical thesis, which means more to me than the fundamental, my scans of new highs vs. new lows yielded about 250 new highs vs 125 new lows last night. That is by any rights a pretty positive divergence on a down day. But I see stuff that is kinda boring making new highs. Have a good weekend.