special-update-bobs-stocks

Special Update-BSMWF Newsletter-Sept 13, 2017 – bobsstocks.com

If I told you in July that by mid September:

N Korea would launch ICBM’s capable of reaching the US

Have N-bombs small enough to fit on top of those missiles

Detonate an 100 KT H-bomb, and

Two super hurricanes would devastate two of the most populated states in the USA within two weeks time,

Would you believe it?

If you are one in a million that answered affirmatively then would you have predicted the stock market would make new all time highs just two days after all these events actually occurred?

Ladies and gentlemen, that is what just happened!

The predicted 5%-8% correction ended at 4% and ended officially yesterday with a new all time high in the S&P 500. This bull market continues to have legs. Bull markets surprise on the upside. We, of course, are not surprised by the stock market behavior.

Knowing the market was venerable I raised some cash but the high MM readings suggested the up trend would continue after a correction. The MM being so strong, kept me in the market while the pundits predicted the end of the world, as we know it. So it goes in bull markets!

Tell me it isn’t amazing the market is at all time highs again given the world and national events. The MM sees though the “news” and focuses only on the trend.

I am looking at options to get long with the cash supply I have built up. Knowing October is a challenge for the markets historically; I do feel some reluctance in getting too long too fast.

Of course my flagship Strategy 1 is up 21% since Election Day! Listening to the news, especially political isn’t good for your investments! The MM has been my friend.

On a personal note, many of you know we live in Colorado in the summer and Longboat Key in Florida during the rest of the year. Hurricane Irma was a mind-bending experience for us with a weeklong threat of being wiped out. It was a weird time for me personally. Being an atmospheric scientist made it quite fascinating and I was taken by the amazing and intricate development of one of the greatest hurricanes of all time.

Forming off the coast of Africa it had a very small chance, less than 1%, of traveling across the Atlantic, missing landfall in Puerto Rico, Hispaniola, Cuba and finding a 90 mile wide stretch of open water between the US and Cuba then turning north and paralleling either the east or west coast of Florida. Add one more factor that it would be a Cat 5 hurricane with 185 mph winds with gusts to 225 mph and maintain that strength longer than any storm in known history. Now that 1% probability is down to maybe .01%.

This almost impossible nightmare scenario played out exactly with one small caveat. While the eye of Irma did not make landfall in Cuba, the storm bumped along the archipelago along the north coast allowing the southern part of the storm to be over land for more than a day. That interaction slightly disrupted the organization of this perfect Fibonacci spiral and the Irma struck Florida at Marco Island with 142 mph winds and went 20 miles inland instead of up the west coast of Florida.

Yes folks it is a game of a few miles. Had the storm been 10 miles off the coast of Cuba and 20 miles west of its actual path though Florida, a super Cat 5 catastrophe of unimaginable magnitude would have happened. The distance from Irma’s African birthplace to Tampa Bay is 7000 miles! Ten or twenty miles seem like round off error when thinking about this long distance but in this case prevented a wipe out…a true Black Swan event.

What a fascinating, scary and stressful week it was! We came though it all with minor issues! We are so very grateful! I still am numbed by it all.

The markets and the weather can be challenging even if clear skies rule most of the time. Now you know why this newsletter is called Bob’s Stock Market Weather Forecast!

The September BSMWF will be issued soon….click here to subscribe.