Sunrise Energy Metals Ltd SREMF

View to the future for stocks

[MAGICLENS]

Here's a contrarian view that I take: Now is the time to accumulate equities. It will take bravery and a long-term view. Downward momentum is high in the NASDAQ. This kind of volatility can foster huge reversals and retracements. The Fed will continue cut in the future. Tax cuts will stimulate the economy. It is probable earnings will be down 5% to 7% through the first two quarters of this year, and should grow 4% by the third quarter. The third quarter will be the bottom of the earnings slump. Equity markets could flop around like a fish out of water for another few months but we are quite comfortable the cuts in rates will eventually gather investor attention and stocks will head significantly higher in a year. Trading ranges for the next 90 days are likely to be: Dow Jones Industrial Average (11000/10000), Russell 2000 (550/410), S&P 500 (1385/1150), and NASDAQ (2900/1780). Fear is the prevalent sentiment and I buy mass fear. Sentiment model (Paul Rabbit Analytics) says this is the highest fear in more than two years. The put/call volume ratio reflects the same high fear. The plunging NASDAQ has sucked wealth away from consumers. We will get very important consumer and manufacturing sentiment figures this week. In fact, a poll of Wall Street bond dealers last week showed a consensus that the Fed would cut rates 50 basis points at the March 20 meeting.