2016 is the timing of the investment stock？
Due to the high cost of living and financial pressure, a lot of people are looking for extra ways to invest and make money. Nowadays, everyone is interested in making more money and stock trading is one of the best platforms to invest.
Timing is a very important factor when making investment decisions. As an investor, you don’t want to lose your hard-earned money because of poor investment decisions. Corporate economic growth is usually signified by the high rate of investments. It is vital for investors to learn how to observe market trends in order to determine the appropriate time to make an investment. The stock market is considered across the globe to be highly lucrative and many people have shown an interest to be part of it. However, some investors fail to realize that it’s not only about having the money to invest but knowing the right time to invest.
“Let’s make a bet,” my 6-year-old son said to me when I picked him up from school the other day. “I bet we get home at 2:56. If we get home then, you owe me $10!”
“Sure,” I said. “But you owe me $10 if you’re wrong.”
Seeing as I had control of the wheel, I figured it was a bet worth making just to prove a point – don’t gamble, and never bet money on something the other person is in control of.
At the end of the bet, another life lesson came into the picture – the different interpretations of what exactly defined the bet. That brings me to the issue at hand today.
So let’s make a bet, just to prove a point: I’ll bet you $10 that we entered an earnings recession back in April. You can take the other side of that bet, and say we are not yet in an earnings recession.
The truth is an argument could be made for both sides of this bet. Officially, an earnings recession is two consecutive quarters of falling corporate earnings. However, there are many different ways to define what corporate earnings are.
You could look at net income, operating profits, earnings per share or adjusted earnings per share. Either one could technically define an earnings recession, which is why we could both be wrong in our current bet, or we are both right, depending on how you look at it.
We are on the verge of breaking lows set in 2014 near 1,800. The S&P 500 needs to fall less than 6% to break that support level and the market can easily do that if we have a down year.
So we have to see where the market will find support after breaking that 2014 low, and the next red support line won’t kick in until we hit the highs from 2007 at roughly 1,550.
That’s a 19% decline from today’s prices shown by the red arrow.
There’s also a second arrow, in orange, showing a drop to about 600 – a 68% free fall from today’s prices. That’s where the market will find support if it breaks the 1,550 level. That may not happen in 2016, but I think this demonstrates that the 1,550 level isn’t an exaggerated expectation; it’s actually modest and should be thought of more as a minimum, instead of a maximum, drop.
If you have been following my articles, then by now you are well prepared to handle a market crisis.
I have laid out the steps to take to ride out a crash, as well as the best asset to own in the event of a crash – gold.
Granted, there is a 1% chance the market will be positive this year, but I choose to follow the odds.