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Kerry Balenthiran

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  • Have We Seen The Bottom In The Gold Market? [View article]
    I want it to go higher so I can sell out, hopefully at the top of the cycle.

    Back in June I thought the low was in, its been an uncomfotable ride since then but the low has held. Time for gold to surge now IMHO.

    http://seekingalpha.co...

    Jan 20 10:25 AM | 3 Likes Like |Link to Comment
  • The Gold Cycle Has Bottomed [View article]
    Hi Saks12,

    Yes it is time for a new article on gold, I have been waiting for confirmation that it has indeed bottomed. We are close to confirming the cross of the 50 day SMA (close above for 3 days) and mining indexes are also close to this.

    I think the next cyclical bull market is underway, but this is not to be taken for granted yet.

    Kerry
    Jan 16 02:20 PM | Likes Like |Link to Comment
  • 4 Reasons Why We Are Still In A Bear Market [View article]
    Hi Eric,

    Great article, I couldn’t agree more. In fact I believe in this cycle so much I wrote a book about it:

    http://bit.ly/1eEKFKO

    The cycle is shown on Ritholz blog for 1982 to 2018 and in the book I demonstrate how it is works during 1929 to 1947 and 1965 to 1982 with the same increments of 2.2 and 4.4 years. The tricky bit is the tail end of the bear market which is very volatile and hard to trade. I have stated that 2013 would present a fantastic opportunity to go long with conviction and I now think that date was 1/1/2013. I missed this point as I thought we’d get lower lows but started buying following the June sell off. You could argue that I should have shown 2011 to 2013 as a green period i.e. 2013 as a top. I am open minded about that but that isn’t what my research led me to conclude.

    http://bit.ly/1eEKHCd

    I am fully long at the moment and although I may lighten up as we move into April/May, I will remain heavily long through any correction that occurs as I pick my stocks based on fundamentals and will use a drop to top up as opportunities arise. 2009 was the 1974 low based on my cycle, we saw a 20% drop after the 2011 high and 2013 was the breakout after the 2011 drop and consolidation. I am happy to buy and hold from now until 2035, although I have no doubt there will be volatility along the way, especially once interest rates start to rise.

    One thing I looked at was combining various cycles such as the Halloween Cycle, Presidential Cycle and the 17.6 year cycle. This yielded excellent results (long/cash 19x DJIA and long/short 121x DJIA) and consistently beat the Dow Jones since it started in 1897. Not every period outperforms and 2013 was a disappointment (as the system was in cash) but having missed all of the big drops, it can afford to miss some of the gains. I remain long based on this research.

    http://bit.ly/1eEKFKP

    I have seen the doom and gloom megaphone charts which project the Dow falling to 6000. I can’t see it myself. What I think will happen is that we will see PE ratios contract over the next few years as inflation picks up. This would then result in equities becoming cheaper and better value relative to now but doesn’t necessarily mean that stock prices will come down. Therefore by 2018 we could once again say that equities are cheap and unloved at Dow 15000 as they would have gone broadly sideways for 17 years , which we certainly can’t say now.

    Regards,

    Kerry
    Jan 16 05:49 AM | 1 Like Like |Link to Comment
  • This Time It's Different? [View article]
    OK time to admit that I may have been wrong about a 20% correction in 2013. There is still time for this to happen but I believe the window is closing.

    My cycle work had 2011 to 2013 as a period for a 20% correction and then a buying opportunity. We had the May 11 top and then a 20% bear market (just). At the beginning of the year it looked like we were in a final topping move and would correct this autumn. This seemed probable given the Fed taper which would drive up interest rates and adversely impact discounted cash flows and therefore analyst stock valuations. After this I was looking for a move up and a low in 2015 (not lower than the 2009 low).

    So many risk events have passed that I now can’t see the driver for a sell off except tapering. The non-taper move was a surprise and I believe we are now in a period where the Fed talk about taper but don’t do anything until they are forced to (perhaps late 2014/early 2015, this should be a great environment for gold.

    I am starting to think that the low was in 2011 and 1/1/13 was the buy date. This would mean that we could have a top in 2013/4 and the next low in 2015 (as per the next phase of the cycle). Using the cycle in the article, Oct 9th may be the low for this cycle and we may need to wait for Jan for a deeper correction. Even if this happens my intention was to re-enter in 2013 and I still intend to do this. My cycle has a chopping sideways period from now to 2018, we may not see much share price appreciation but this will still be a good time to accumulate stocks IMHO and better than the alternatives (expect PMs which I am already heavily invested in).

    To recap, I am 50% in precious metals and 50% cash. I have bought a few stocks since the June low but I now intend to put all of my cash to work by the end of this year (as long as I see opportunities). I have a 20 year horizon and expect that the next correction will be bought up quickly.

    So to be clear, I admit that I was wrong about a Sept/Oct low, although there is still time for a 2013 low in Nov/Dec, but I still believe in the longer term 17.6 year stock market cycle. In my book I say that 2013 would provide a great opportunity to go long stocks until 2035 and I will invest accordingly. The exact low may be behind us or a 20% correction may be ahead of us, however I am going to be 100% long by the end of 2013 and ride the next great bull market.

    I recommend reading this article by me as it shows how the cycle has identified and avoided all of the major Dow bear markets and returned 19x as much as the index buy-and-hold approach.

    http://bit.ly/19jhgqL

    Good luck all, happy to discuss. I will write a SA post at the end of the year to provide a full update.
    Oct 20 08:43 AM | Likes Like |Link to Comment
  • Halloween Indicator Strategy Smashes Dow Jones Buy And Hold Return [View instapost]
    The full article is here with the data tables and comparisons to the Presidential Cycle and Six Month Switching Cycle.

    http://bit.ly/19jhgqL
    Oct 3 02:40 AM | Likes Like |Link to Comment
  • This Time It's Different? [View article]
    Hi Steven,

    I am still waiting patiently for the drip drip selling to turn into a waterfall. It is looking promising, not far to go until the Aug FTSE low of 6400, if this breaks then we should see 6000 again.

    Nothing is certain though, so I watch and wait. Did you see my recent Investors Chronicle article from 20 Sept 2013 about buying on 31 Oct 2013?

    Regards,

    Kerry
    Sep 30 05:28 AM | Likes Like |Link to Comment
  • The Gold Cycle Has Bottomed [View article]
    Hi Saks12,

    I am still of the opinion that the June low was a significant low and still am long gold. I could be wrong of course so you must do your own research and invest accordingly.

    The massive bearishness is good as long as gold can hold above that previous low. Note veryone is bearish:

    http://bit.ly/1anSaEc

    Regards,

    Kerry
    Sep 25 06:56 AM | 1 Like Like |Link to Comment
  • Has Warren Buffett Nailed Another Market Top? [View article]
    Thanks Sy, excellent article and reading about his liquidation in the 60s was one of the things that got me thinking about the 17.6 year secular stock market cycle, along with the Forbes article obviously.

    I have a fundmental approach to stock picking, but a cycles approach to when to be in or out of the market.

    http://seekingalpha.co...

    Regards,

    Kerry
    Sep 21 10:25 AM | Likes Like |Link to Comment
  • Daily State Of The Markets: What Do The Cycles Say About September? [View article]
    Good article, thanks David.

    You a right that September can be vicious. The 17.6 Year Stock Market Cycle highlights 2013 as a change of trend and caution is required over the next few weeks as per this Dow Cycle article from May:

    http://seekingalpha.co...

    Regards,

    Kerry
    Sep 9 08:53 AM | Likes Like |Link to Comment
  • This Time It's Different? [View article]
    Hi Alphaglenn,

    No I do not think we are done yet. We are likely to get a bounce for a week or two, markets never move in a straight line, but I still believe the bottom is ahead of us.

    Some cyclical UK FTSE100 stocks that I watch are down 20%-30%, this is offset in the indices by miners rallying hard and Vodafone jumping. However stocks are moving to more reasonable valuations.

    There have been some fast moves down and the S&P fell approx 5% so far, the next move, if it comes, will hopefully take us down 10%-15% at least from the top.

    You are right that what we have seen so far is not that dramatic, what will happen when volume kicks in after the holiday?

    In answer to your last question, by the end of October we will know whether I am right or wrong.

    Regards,

    Kerry
    Aug 30 03:15 AM | Likes Like |Link to Comment
  • Still Bullish Despite Worrisome Indicators [View article]
    Hi Scott,

    I do not think global risks have diminished and they may actually increase into the Fed meeting on Sept 17 and German elections on Sept 23. This uncertainty will pray on investors minds.

    I am still expecting a low in September as per this article from May. We may have had a slightly higher high but I stand by this call for a market correction that will provide a good buying opportunity.

    http://seekingalpha.co...

    Regards,

    Kerry
    Aug 15 12:12 PM | 1 Like Like |Link to Comment
  • This Time It's Different? [View article]
    Hi Steven,

    I think that the recent Aug FTSE high is a lower high following the May top and that we are headed lower into the Sept/Oct, based on my cycle work. Although we had a higher high with the Dow, my view is unchanged, although it is possible that the low will come slightly later.

    Let’s see what happens as we move into Sept, particularly around the 13th Sept. I don’t see this as the day of the low rather a timeframe to aim for. But price action should be our guide once we have a confirmed correction.

    Remember that Fed meeting is 17/18th Sept and German elections on 22 Sept.

    Regards,

    Kerry
    Aug 13 09:25 AM | Likes Like |Link to Comment
  • This Time It's Different? [View article]
    Thanks Freddy, also as I keep saying the German elections are in Sept and this needs to be kept in mind. They have been keeping the whole Euro project alive and a change to the status quo will cause shock waves.
    Aug 11 08:24 AM | Likes Like |Link to Comment
  • This Time It's Different? [View article]
    Great call Naples looking for a top last week and now it seems it could be true. The European indexes appear to have topped in May but not the US ones. Hoping for a low in Sept but not sure if it may now be delayed? Price action and the speed of any correction will guide us.
    Aug 11 08:22 AM | Likes Like |Link to Comment
  • This Time It's Different? [View article]
    Hi Alphaglenn,

    European markets are still below the May top but US markets continue to make new highs. I’ll accept that my cycle theory is wrong if we do not see a correction by the end of November and I will write an article saying so on SA.

    I am trading my Balenthiran Cycle and continue to be optimistic that the sell off low will occur this Fall. It certainly looks unlikely but IF it occurs it will therefore catch more investors off guard.

    It worked out for me in 2007, despite higher highs in 2008, so I know how to be patient.

    Regards,

    Kerry
    Aug 6 02:11 PM | Likes Like |Link to Comment
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