I am beginning a new series that is designed to demonstrate the incredible importance of Accurate Forecasting prior to making every investment decision. I am using the 30 Dow Industrial Component Companies and 16 supporting Sectors to prove to you just how profitable you can be when you have Accurate Forecasting working for you. With brief narratives and rather simple graphics, I will attempt to win your confidence in how I go about “Investing Wisely.”
The easiest job you can give to a financial analyst is to limit his or her analytics to the Dow 30 Industrial Companies. That is because there is an over-abundance of accurate information and raw data available for each Company. In today’s world, the Dow 30 has more words published each day than a person can be possible absorb. That’s the bad news. The good news is that all this “gobbledygook” can be condensed and translated into precise formulas and graphics from which you can consistently profit. This will permit you to “stop” reading, sorting and interpreting this over-load of information – Now you just have to study and become confident with what I am sharing. I hope you will want to spend some time in my realm of “Investing Wisely.”
The Dow 30 represents about 33% of the total market-cap of the World’s Universe of Companies. At present, the NYSE has about 3,200 listed companies to choose from. And, the Nasdaq sports about 6,000 companies. ALL these Companies, in one way or another, do the same thing that I am demonstrating with the 30 Dow Companies and 16 Sectors.
The below ten Dow components I Forecast and support with clear Graphics in this article are listed in the table below. I will offer the next ten one week from now and rotate through all thirty Dow Companies and a number of supporting Sectors in the coming weeks.
I hope in conjunction with the supporting graphics in StockCharts - Public List you will quickly come to understand and be comfortable about how I use my Fundamental – Valuation and Technical Analysis to make very Accurate Forecasts and hence, provide my Clients with Formal Securities Recommendations and consistent annual profits in their portfolios.
Table of ten of the Dow 30 Components
Please click to enlarge
Forecasting is My Trick for Consistent Profits and “Investing Wisely”
Forecasts for the Above Ten Companies
These ten Companies currently do not have overly strong Valuations and Target Price Projections. The current Valuation Divergence is currently negative. My technicals for these Companies all have been deteriorating with regard to my proprietary Indicators and that in itself is a “Warning.” Current Consensus Opinion is much too bullish and always is! Security's valuations should be updated, and your securities holdings reviewed as frequently as possible. This should be done weekly – do you have or take the time to do your homework?
Perhaps - Most Important to this Article are my supporting Graphics in StockCharts - Public List. They can be individually viewed by clicking on any of the below Symbols:
AA, AXP, BA, BAC, CAT, CSCO, CVX, DD, DIS, GE, HD, HPQ, IBM, INTC, JNJ, JPM, KO, MCD, MMM, MRK, MSFT, PFE, PG, T, TRV, UNH, UTX, VZ, WMT, XOM
Sectors: $DJUSBK, $DJUSBM, $DJUSBT, $DJUSCY, $DJUSEN, $DJUSFN, $DJUSHC, $DJUSSC, $DJUSIT, $DJUSTC, $DJUSUT, $GOLD, $MSEMF, $SILVER, $WTIC
If you would like to page through all my Graphics, including, by far the single best General Market Indicator I have ever worked with, please click on the below URL and scroll through my “stuff.” If you do it just once, I believe you will want to take another tour rather frequently in the coming weeks / months.
My general market opinion is -- the fundamentals are over-valued; the technicals are over-bought, and the consensus opinion is way too bullish. Economic and financial news is very negative and not supportive of taking any Bullish positions.
I am currently a Bear because my valuations are convincingly negative, the charts are breaking down daily. And, we are now in a Bearish Cycle; it's just that simple!
Patience and Discipline are more important than the above data, tables, charts and information. However, the focus is always the question: do I Buy, Sell or Hold? I can give you the answer with just a few minutes of research! My question for you is, do you have the patience and discipline necessary to profit and to hold cash from time to time? And, can you wait until you can be sure to profit or do you follow the media hype?
My stringent criterion for taking a Bullish position is that the company must have the prospect within its fundamental valuation and technical charts to outperform the general market, its sector, and industry group. The opposite is true for taking Bearish positions.
It is a fact that, the stock market Cycles endlessly both fundamentally and technically. It continuously moves from a Bullish Cycle to a Bearish Cycle and then, back to a Bullish Cycle again. Unfortunately, this repeating pattern is not well-understood or taken advantage of by most investors. Mutual Fund asset managers have not considered this “fact” for decades!
This analytic work I do each day is fun and profitable. There always new Companies being added a list of the best (for buying) and worst (for shorting) companies to further valuate and study. Seeking profits by focusing on the best Companies, or perhaps the worst Companies is definitely a challenge. The Companies between the best and the worst are never considered as a current investment. I call them “Also-Rans.” All Companies rotate into favor and out of favor. Each Company is in rotation taking its turn at being a profitable investment – both Bullish and Bearish. Sometimes it (a Company) is one of the best and at other times, it is one of the worst! To be consistently profitable, you must maintain lists of the best and the worst Companies and wait patiently to implement. This analytic work must be complete and ready to go, well ahead of the next Bullish or Bearish Market Cycle and Inflection Point.
I hope you like my Methodology and will continue to follow my work / analytics. It won't be long before I can offer you a Bullish and up-beat Forecast once again.
Have fun, “Investing Wisely,”
By. Dr. Steve