MY JOURNAL FOR WEDNESDAY MORNING – DECEMBER 4, 2019

NEWS, BREAKOUTS, MOMENTUM PLAYS, & BOTTOMS

Logarithmic Scale vs. Arithmetic Scale – 5i Research 📰

If you’re familiar with my work, you know I’m a huge proponent of momentum investing. For those of you who don’t know, momentum investing is a strategy where the objective is to profit from the continuation of trends.

The term “trend is your friend” derives from the theory that stocks trending in one direction will continue to go much higher than assumed possible. In other words, great companies with a proven track record tend to continue to perform well. The difficulty with this investment strategy is emotions because people have trouble buying stocks breaking out to new highs. This psychological barrier becomes troublesome as many investors avoid these breakouts. One way to help mitigate some of this emotion is to use logarithmic scale charts.

The difference between a logarithmic (log) and arithmetic (linear) chart scale can be seen on… – READ MORE

Dwight Galusha, CMT, is a contributor of 5i Research is a conflict-free investment research provider for retail investors offering research reports, model portfolios and investor Q&A, which is available to try for free (Click Here).

Stock Market Outlook for December 3, 2019 – EquityClock.com 📊

The uncertainties over the next couple of weeks was sufficient to elevate the volatility index on Monday. The index has spiked from a low below 12 last week to almost 15 on as of Monday’s close. Followers of our work will be aware of the simple sell signal that we’ve presented in the past pertaining to such an event. When the VIX bottoms below 12 and subsequently rebounds above it, the equity market has typically declined as market complacency is worn off. Pervious instances this year were observed in the middle of April and the end of July, each prior to a market pullback of around 5% from peak to trough. – READ MORE (click here to see seasonal charts)

Tech Talk is a free stock market letter service available at TimingTheMarkets.com and EquityClock.com. Ask us about the Seasonal Advantage Portfolio.

The Stock Market Doesn’t Care How Hard You Try 📺

The incredibly bright and insightful Morgan Housel of the Collaborative Fund drops by the Compound to discuss some of the biggest mistakes and misconceptions that plague investors year after year – and what can be done about them.