Stocks Could Enter A Bear Market In 2013: Market Is Often Down Sharply After Presidential Election In February, Major Negative Divergences Indicates A Risk Of A Deep Correction, Increased Taxes & Regulation, And China Signals Tolerance for Slower Growth

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BofA: Here Are 3 Reasons Why Stocks Could Enter A Bear Market In 2013

Bartels’ second concern is the presidential cycle. She writes that “after a presidential election, in the month of February the market is often down sharply, on average by 2.3%.”

The chart below suggests 2013 will mark the “weakest period of the presidential cycle,” based on historical trends:

 

Three Divergences Demanding The Stock Bulls’ Attention

Longer-term divergences tend to provide the most concerning [...]

Stock Market Crash 2013: What The “Hindenberg Omen” Tells Us

From etfdailynews:

Don Miller: Should you be worried about a stock market crash in 2013… or even sooner? Certainly, there’s plenty of unsettling news to worry about. You know what I’m talking about…the persistent Eurozone debt crisis, Taxmageddon, the fiscal cliff, high unemployment.

The list goes on and on.

But now, there’s one more reason to fasten your seat belt.

On the heels of a sharp stock market decline on July 24, a highly accurate technical indicator called the “Hindenburg Omen” started ringing warning bells.

Ever since [...]

One major market sector could be on the verge of a big, long-term breakout

From All Star Charts:

The relative strength we’ve seen in the Dow Jones Transportation Average has been awfully impressive. And not just recently, but actually going back to the year 2000. While the Dow Jones Industrial Average is up less than 30% from those early 2000 lows, the Trannies are up over 120% during the same time period.

… On Thursday, as U.S. equities were staging a comeback after lunch, the Dow [...]

Why The Euro Is So Strong, Or Why The Market Expects $700bn Of Fed QE3

The question puzzling currency markets is why the EUR is so strong.  While we have argued that during the risk-off period of the last month or so post-LTRO2 (before Tuesday) EURUSD strength appeared to be driven by repatriation flows and balance sheet reduction, new information over the last couple of weeks driving the expectation that growth will be weak enough in the US to keep US policy very stimulative for a nice [...]

Iran + Oil + Consumer Weakness = Bull Market?

By Michael A. Gayed

“I am not a speed reader. I am a speed understander.” – Isaac Asimov

With oil prices touching $105 a barrel on news that Iran is enacting an oil embargo on Britain and France, its natural to argue that escalating tensions could immediately be the next focus for investors, post-Greece. The bears will argue that oil prices now are on their way back up as [...]

It is quite telling that the S&P 500 has fallen far less than the BRIC markets: the S&P 500 is 16% off its highs, while Brazil is off 23%, Russia is off 22%, China is off 20%, and India is off 28%.

by Phoenix Capital Research

One of the primary arguments that the world is in “recovery” comes from the decoupling argument: namely that emerging market economies have grown to the point that they will hold up even if there’s a downturn in the US economy.

 

For certain, emerging market economies have indeed experienced economic growth and stock market gains far exceeding those of the US and other developed [...]

“O’Sullivan said. “We remain optimistic.”"

Optimism, like pessimism, is a dangerous tool when applied to markets and investing. I like to be optimistic about life, pessimistic about government and politicians, and when it comes to the economy, stick to data analysis and check your bipolar disorder at the door.

The data is mixed, but it strongly suggests that we are entering what von Mises called a “crack-up boom”. Dean Foods stock got clocked for an earnings [...]