Commentary: Paul Ebeling on Wall Street, Optimism is Key

Commentary: Paul Ebeling on Wall Street, Optimism is Key

$DIA $SPY $QQQ $RUTX $SOX $VXX

Optimistic US Stock Market Will Survive Racial and C-19 Coronavirus Chaos|

Last week’s action

 Stocks continue testing, as indexes that marked new highs have given them up. The charts of the PHLX Semiconductor Sector (SOX), the S&P 500 and others show reversals, suggesting there may be more testing (selling) in here.

But, all leaders have not sold off. Many are testing normally, and not all recovery stocks are as destroyed as the pundits are broadcasting.

The market is 100% backed by the Fed. The way this plays out is Bullish overall.

Technical Analysis

NASDAQ, NAS 100 and SOX: These indexes marked new highs over the past week, reversed and flushed out lots of speculators. The NAS 100 swept away 4 Northside session.

S&P 500: The S&P 500 gapped higher a week ago last Friday and managed to clear 3,100, moved higher Monday, but saw modest losses Tuesday and Wednesday. Then, it hit a gap lower through that same gap point on Thursday and formed an island reversal there.

Optimism is the American Way

Financier Michael Milken is more optimistic than he has ever been that the nation will not only eventually conquer racial strife but will also overcome the C-19 coronavirus chaos while the stock market holds firm as Americans invest in their future.

The world for most Americans has been turned upside down.”

 “There is no other alternative. When you ask Americans what the American Dream is, its freedom to live your life,” he said. “We are being challenged on the freedom to live our life,” he said.

World War II was a challenge to our way of life and the country and people responded,” he said. “This virus and the events in Minneapolis are an attack on our very being to what we stand for.  So we all have to respond,” said Mr. Milken, the former junk-bond King.

What we’ve seen is unacceptable. It is not America and we’re going to change

We underestimate what a country that affords freedom to people is worth. How much would a person pay just to be able to come and live in the United States? So it’s the social capital and fabric we need to protect right now,” he said.

We have had a shock in this country and we need to respond.”

Mr. Milkin heads the non-profit Milken Institute, he is focusing on a wide span of research, including curing cancer, public health, aging, California and financial markets.

Amid all the health emergence chaos and racial uncertainty, Mr. Milken sees the market hold firm, predicting stocks may end up finishing the volatile year flat to unchanged or much higher.

There is a desire to invest in America. People around the world would prefer to invest in America.”

Are they going to invest in a government bond that yields less than 1% or are they going to buy stock in a company here?” he asked.

He said lower interest rates drives people into the stock market or other alternative investments.

He said pension funds and college endowments have to look beyond government bonds for substantial returns.

He urged Americans to to “invest in companies you believe in” to send a message of change to corporations.

In the 21st Century, a company has to stand for something. ‘Where do you stand?’ And I think we saw where the country stood when it saw the video of what happened to this man in Minneapolis. Are you going to sit and moan and do nothing or are you going to figure out what to do?”

He is not worried about the mountain of debt left behind for future generations.

If you are worried about the next generation, all we have to do is sell 40-yr bonds and we will skip the next generation,” he said.

We need to be giving people opportunity, giving people hope.” 

I have no other choice but to be optimistic. I have too much faith in science to say we’re not going to find a solution so I am optimistic,” he said.

You have to assume that every individual someone is making the decision that they are going to change the course of history,” he said.

That is why I am optimistic and that’s why I see a solution medically and that’s we’re not going to go back to a lockdown,” he said.

“I can tell you right now hundreds of thousands of people working in the bioscience industry are going to make sure it’s not terrible in October.

Have a healthy week, Keep the Faith!

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Paul Ebeling

Paul A. Ebeling, a polymath, excels, in diverse fields of knowledge Including Pattern Recognition Analysis in Equities, Commodities and Foreign Exchange, and he it the author of "The Red Roadmaster's Technical Report on the US Major Market Indices, a highly regarded, weekly financial market commentary. He is a philosopher, issuing insights on a wide range of subjects to over a million cohorts. An international audience of opinion makers, business leaders, and global organizations recognize Ebeling as an expert.