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May 2017
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A lot of resistance for the US Market

                The US stock market have all the reasons it needs to go higher, durable orders results were better than expected, first time home sales were better than expected, low interest rates and with the amount of money pumped into the system the idea of asset devaluation is hard to swallow.  Yet, the market is barely moving to the plus side.  We at Alphas Edge have been warning people to get out of equities for a few months now but our sentiment has not changed.  No one expected a 6 month straight rally without a selloff, but that’s what we got.  Stock prices are so overvalued that it is priced in for another 20 year bull market.

                The US dollar is now gaining strength and we hope that this trend continues.  This will be clearly a drag on the overall markets, specially emerging market and commodities.  What we are hoping to happen is a 5% to 20% strengthening of the dollar in the next 6 to 9 months.  This would result in commodity prices going down and hyperinflation will be kept in check.  Unfortunately for the equity markets, this will most likely result in a 7.5 to 30% correction.

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