Lex van Dam
  • Contact us: +1 212 203 0630
  • +44 20 3286 3408
  • Request a callback
Login
  • Online Course
    • Million Dollar Traders Course
  • Trading Club
  • Blog
  • Affiliate Partners
  • About Us
    • About Us
    • Million Dollar Traders

News

Over 20 years experience and counting...

Bad Luck Comes in Threes

Posted on October 4, 2019

Hi Everyone,
 
This week’s data have further confirmed the growing risks to the global economy, and the 10 year long bull market in equities. On Tuesday the ISM Manufacturing PMI report fell again and missed estimates, reaching it’s lowest level in a decade with a second consecutive reading below 50. Compounding the worries for the other disappointing data reflected in our Business Cycle Checklist recently, the probability of an imminent recession and coincident bear market in risk assets is becoming ever more likely, as we discussed in this week’s Trading Club video analysis.
 
There is a saying that “bad luck comes in threes”, and what I am about to show you supports that. Here you can see the Business Cycle Checklist which turned negative this month for the first time in 13 years, signalling an end to the economic expansion.
 
business cycle checklist, trading club, lex van dam trading academy
 
Elsewhere in our latest Monthly Checklist Report for October, our Market Risk Checklist was also pointing down, agreeing that investors should brace for weakness in risk markets.
 
market risk, trading club, lex van dam trading academy

 

To help visualise this, here’s the ratio of the Industrials to Consumer Staples sector ETFs which shows the ‘riskier’ cyclical stocks underperforming the ’safer’ defensive names.
 
market risk, lex van dam trading academy, lex van dam
 
It’s rare for everything to be perfectly aligned when dealing in markets. But with the Business Cycle and Market Risk Checklists both negative, and US Equities Checklist (below) at -2, we have the 'holy trinity’ of market forces confirming one another, putting downwards pressure on equities.
 
US equities this month, market crash 2020, recession 2020, stocks crash 2019

 

 

As you can see, this is already playing out in the S&P 500 with the futures down -3.5% since we updated our Monthly Checklist Report on 25th September...
 
 
Whether you are superstitious about old sayings or not, there is no denying the price action that is playing out on the basis of the facts presented by our Checklist process.
 
Time will tell how this all plays out, but what’s clear is that things are becoming far more complicated in markets and it has never been more important to trade with a proven process. We provide our Checklists for a range of markets at the Trading Club and update them for our members on a monthly basis with video updates each week tracking the evolution in markets.
 
If you would like to join us for our full analysis including new insights each week, or learn from the ground up with online tuition from Lex in our MDT online course, then reach out to us now and take your financial knowledge to the next level right away! 
 
 
Have a great weekend,
 
James
 
 

James Helliwell | Chief Investment Strategist

 
Disclaimer: Our service is intended for educational and informational purposes only and should not be considered investment advice. Do not make any decisions based on the articles and material presented on www.lexvandam.com and never trade with money you cannot afford to lose. We cannot be held responsible for your trading results. For more information, please check Risk Disclosure - T&C.

 

 

 

«All News

LVD Financial Education ©2015

  • Terms and Conditions & Disclaimer
  • Privacy Policy
  • Consent
facebook twitter linkedin google plus youtube rss pinterest
Welcome to the all new Lex van Dam Trading Academy. We are working hard to finalise things and have everything available shortly. If you are an existing Lex van Dam Trading Academy client, you may log in here.
A free copy of our weekly market report is on its way to you! You will now be redirected to our Trading Club page. Become a member today to get your second month FREE or 25% off a yearly subscription.
Let's Go
Once you have purchased the Million Dollar Traders Course you will have full access to this video plus all the others via the member area of our website. If you have any questions, please click here to contact us.
Thank you for successfully registering your interest with us. You will now be directed to a secure page to complete your application via our approved partner (opens in a new tab).

Alternatively if you indicated that you require help, a member of the Academy’s team will be in touch shortly via the contact details you provided.