Why I’m Buying December 2014 Spyder Put Options
Marc Faber, Peter Schiff and Nouriel Roubini are endlessly calling for the mother of all crashes for 2014, but now a different source is sounding the same 2014 stock market crash alarm — Richard Ross, a global technical strategist at Auerbach Grayson, and he is calling for a serious correction. He’s quite bearish and thinks the market’s are going significantly lower.
Ross sees a big problem with the S&P 500’s chart — a 20 percent problem to be exact. In 2011, the index corrected by about that much to its 150-week moving average after making moves very similar to its most recent price action. He thinks that we’re in exactly the same scenario — a similar decline to the current 150-week moving average would also be roughly 20 percent to around the 1,500 level. He thinks that’s what we’re staring at right here. He thinks that there’s still time to get out of this market.
Bernanke’s Federal Reserve Policy will be the primary reason for a 2014 Stock Market Crash!
Charts are one thing but is there a fundamental reason to back up Ross’ bearish views.
Recent economic data have been soft, including this week’s first-quarter U.S. GDP report that showed the slowest growth since the fourth quarter of 2012. The earnings front has not been much better for growth stocks either and recent weakness in housing is sounding the alarm for investors.
If you look at the pillars of the economy that should be holding us up, one of the biggest that’s been doing poorly is housing — if we see further (declines) in housing, that could be very negative.