Warning Signs: S&P 500 Plummet Ahead

Summary

インベストメント業界のベテランであるJeff Hugeが、手堅いチャート分析をベースに、現在の市場の過熱状況とそれに伴うリスクについて警鐘を鳴らしています。投資家の楽観的な姿勢、業績見通しの過剰な楽観主義、株式市場の過小評価、AI株のへゲモニー、内部者売りの増加などの指標を紹介し、市場の調整局面が間近に迫っていることを示唆しています。伝統的な引波理論に基づき、今週末の発表が最後の上昇の引き金になる可能性も指摘しつつ、その後の長期的な下落基調に注意を促しています。

Takeaways

• 🗓️ ニュースレターが3月2日(土曜日)に発行される
• 📈 ニューヨーク証券取引所の composite 指数と新高・新低の比率に乖離が見られている
• 🤖 AIにより 7つのビッグテック企業が大きく高騰している
• 📊 過去のデータを見ると、ウォール街の予測は実際の実績を上回ることが多い
• 🌎 7大テック企業の時価総額が中国の株式市場を上回っている
• 😀 投資家センチメントが極端な高水準にある
• 🔮 波動理論解析により、市場が頂点に近づいている可能性がある
• 🏢 経営幹部の大量売却も頂点に近づいている兆候である
• 💰 流動性の低下が今後の金融危機のきっかけとなる可能性がある
• 📚 今後の投資判断の参考にするため、ニュースレターの購読を勧める

Q & A

何を通してジェフ・ヒューゲが今回のプレゼンテーションで言及しているのでしょうか?

ジェフ・ヒューゲは、様々なチャートや指標を分析しながら、マクロ経済や市場の動向についてディスカッションしています。特に、株式市場の割高感、投資家センチメントの極端な楽観ムード、アナリストによるEPSの過剰予想など、警告すべき点を指摘しています。

ジェフ・ヒューゲは市場のトップをいつ付けると予想していますか?

ヒューゲは、S&P500の2月23日の最高値5111がトップを示していると考えています。または、もう一段の上昇があって、そこでトップを付けるかもしれない、と述べています。現在の4920を下回れば、トップ入れのサインになるとしています。

ヒューゲはどのような投資家のアンケートや指標を参照していますか?

Investor's Intelligenceアドバイザー調査、ネームエクスポージャーインデックス、CNN fear & greedインデックス、Consensus Incなど、投資家センチメントを示す様々な調査結果を参照し、現在の楽観的なムードを示しています。

ジェフ・ヒューゲは、アナリストのEPS予想についてどのような意見を示していますか?

ヒューゲは、ウォール街のアナリストの予想がたいてい過剰に楽観的であることを示したデータから、2024年と2025年のS&P500 EPSがコンセンサス予想よりも19%程度低い194ドルと220ドルになる可能性があると指摘しています。

ヒューゲが言及する「MAG 7」とは何でしょうか?

MAG 7とはマイクロソフト、アップル、Nvidia、Google、アマゾン、Meta、テスラという7大テック株のことを指します。ヒューゲは、これらの企業の時価総額がこれだけ巨大になり、指数の大きな部分を占めるようになったことに警鐘を鳴らしています。

ジェフ・ヒューゲの投資家向け情報サービスについて教えてください。

ヒューゲはJW Investment Partnersの最高投資責任者で、Alpha Insightsファウンダーです。月額のsubstack投資ニュースレター「Huge Insights」を発行しており、有料会員には週次のトレードアイデア、マーケットコメンタリー、その他のコンテンツも提供しています。

エリオットウェーブ理論の観点からヒューゲはどのように市場をみているでしょうか?

ヒューゲは、エリオットウェーブ理論に従ってカウントを行い、現在の上昇はサイクルウェーブ5、スーパーサイクルウェーブ3の終盤に当たると考えています。今後は5つのドミノ的なギャップをすべて埋めるように下落が続き、マルチイヤー、あるいは10年に渡る大規模な調整局面に入るとみています。

ヒューゲはどのような経済見通しを示していますか?

ヒューゲは2024年にアメリカ経済が景気後退に陥り、グローバル不況が起きる可能性が高いと予想しています。そして、金融危機が起こる可能性も指摘しており、そのトリガーとなる要因の一つが市場の流動性の問題となると警告しています。

ヒューゲはNYSE総合指数の上昇ラインと下降ラインにおける一致性の欠如に言及していますが、これは何を意味していますか?

ヒューゲは、NYSE総合指数では新高値を記録したものの、構成銘柄の上昇ラインと下降ラインの比率が新高値には到達していないことを指摘しています。これは価格行動とブレッド指標の乖離を意味し、従来から重要な市場トレンドの転換を予兆するものとされています。

ジェフ・ヒューゲが市場環境に対し指摘する主な警告点は何ですか?

ヒューゲが指摘する主な警告点は、1)株式市場の過度の高値、2)投資家センチメントの極端な楽観ムード、3)アナリスト予想の過剰な楽観性、4)MAG7等の巨大テック株への高度な集中リスク、5)市場の流動性の脆弱性などがあげられます。これらを総合的に考慮すると、ヒューゲは現在の市場環境をリスクが高いと判断しているようです。

Outlines

00:00

😀 ビデオ紹介とニュースレター登録の勧誘

ホストのジェフ・ヒューズが視聴者を歓迎し、この日がウェデンズデーの2月28日であることを伝えています。彼はJW投資パートナーの投資責任者であり、アルファインサイトの創設者でもあります。今回のプレゼンテーションは「デイリー5」と呼ばれ、投資家にとって重要な上位5つのチャートを解説するものです。今週はボーナスのチャートもあるので最後まで見続けてほしいと述べています。また、3月2日の来週土曜日に、月刊ニュースレター「ヒューインサイト」の次号を発行することを告知しています。このニュースレターは毎月第1土曜日に無料で配信されており、サブスタックのウェブサイト（hughinsights.substack.com）から直接メールボックスに受け取ることができます。さらに、月額$12.50の有料サービスについても紹介しており、より詳細で実践的な情報が含まれることを説明しています。

05:01

🤔 コンセンサスの予測は常に間違っている

このチャートは、1980年から2016年にかけての期間を対象としたY Dennyリサーチによる研究結果を示しています。そこでは、ウォールストリート・コンセンサスの年間S&P500営業利益予測値と実際の結果を比較しています。研究によれば、36年間を通してコンセンサス予測は100%の割合で間違っており、78%の時間で平均19%以上オーバーエスティメートしていたことが明らかになりました。残りの22%の時間では平均6.7%の割合でアンダーエスティメートしていました。今年と来年のS&P500営業利益予測はそれぞれ240ドルと272ドルですが、過去の傾向から見ると194ドルと220ドルの方が現実的な予想値になると考えられます。実際、過去3年間の営業利益は218ドルから220ドルの間でほとんど成長しておらず、もしコンセンサス予測が過去と同様に楽観的過ぎた場合、5年連続で営業利益が横ばいになる可能性があります。

10:03

❓ S&P 500の予想12ヶ月PERは27.9倍

S&P 500の予想12ヶ月PERは27.9倍と極めて高い水準にあります。これは、2000年のドットコム・バブルのピーク時に記録された25倍を上回っています。大手100銘柄で構成される上位100銘柄だけを見ても、その時価純資産倍率は27.9倍となっています。このグループの株式は、S&P 500の時価総額の71.8%、営業利益の50%以上を占めているため、市場を代表する指標と考えられます。現在の高い株価は、企業の実際の収益成長ではなく投資家の強気なセンチメントが主な要因となっていることを示唆しており、引き続き警戒が必要です。詳細な分析データはニュースレターの有料版でご覧いただけます。

15:04

🤩 テク株7社の時価総額は中国市場を超える

マイクロソフト、アップル、NVIDIA、グーグル、アマゾン、メタ、テスラの7大テクノロジー企業（「The Magnificent 7」）の合計時価総額が、世界第2位の株式市場である中国を上回っています。この7社だけで世界の時価総額の13.1%を占め、3位の日本（6.2%）の2倍にのぼります。マイクロソフトだけでも75％のG20諸国の時価総額を超えており、これらの企業の利益は広範な世界の株式市場に匹敵するほど高くなっています。しかし、この利益の多くは景気循環に左右されやすい広告収入に依存しているため、予想される2024年の経済減速で大きな影響を受ける可能性があります。テク株への過度の集中は前例のない水準にあり、市場リスクが高まっていると言えます。

20:05

🚨 強気な投資家心理が極端な水準に

投資家の強気姿勢を示す各種調査の結果が、再び極端な水準に達しています。最新のインベスターズ・インテリジェンス調査では、ブル（強気）のアドバイザー比率が77.5%に上り、7月の高値を上回りました。NSAの上昇率も極端な水準にあり、これらの調査結果は、12月以降何度か指摘してきたCNNの恐怖と強欲指数や名古露インデックスなどの動向と符合しています。一方で、インサイダー売却比率は過去最高の4.5倍にも達し、ベゾス、ダイアモンド、ザッカーバーグらが大量の株式を売却しました。こうした強気な投資家心理と記録的なインサイダー売却は対照的であり、市場の警戒感を高めています。

25:06

📈 ウェーブ分析でS&P 500のトップを予測

エリオット波動理論に基づく分析では、2022年10月13日の低値から5波動の大きな上昇局面（プライマリー波5）が進行しています。この動きは2024年2月23日の高値5,111ドルで終わる可能性があり、その後は長期の下落トレンドに入ると予想されます。最近の高値形成後の調整局面は、ブレッドの減速を示唆しており、トップを示す証拠となっています。一方、別の見方としては更なる上昇の可能性も残されています。明日発表されるPCEデータが予想以上に強気であれば、最後の上げ足が入る可能性もあります。しかし、4,920ドルを下抜けた場合、トップの形成を確信できるでしょう。その後は一連のギャップフィルを経て、10月13日の3,583ドルのレベルまで下落する可能性が高いと考えられています。

👋 アウトロと連絡先情報

ホストのジェフ・ヒューズが、プレゼンテーションを締めくくりました。視聴者に対してウェブサイト（www.jwinvestment.com）、Twitterアカウント（@Alpha Insights）、ニュースレターのサブスクリプション（huginsights.substack.com）をチェックするよう呼びかけています。今後もよいトレーディングを心から願っていると述べました。

Keywords

💡投資

投資とは、お金を利殖させるために資金を様々な資産に投入することを指します。このビデオでは、スピーカーが投資の観点からさまざまな市場動向や指標を解説しています。例えば、S&P500指数の株価収益率(PER)や内部者の売買動向を分析しており、投資判断に関連した重要な情報を提供しています。

💡株価収益率 (PER)

株価収益率(PER)は、株価を1株当たりの利益で割った値で、企業の株価の評価指標として広く利用されています。このビデオでは、S&P500構成企業の平均PERが27.9倍と極めて高水準にあることを指摘し、株価が過剰に高い評価されていると警告しています。PERは企業の価値判断に重要な指標であり、その動向を追うことが投資判断に不可欠だと言えます。

💡内部者売買

内部者売買とは、企業の役員や従業員などの内部者が自社株を売買することを指します。このビデオでは、最近ビゾス氏、ダイアモンド氏、ザッカーバーグ氏など著名な経営者が巨額の自社株を売却した事実を指摘しています。内部者が株式を売却するのは、株価が上がるとは見込んでいない可能性があるためです。そのため、内部者の売買動向を注視することは、市場の将来性を予測する上で重要な手がかりになります。

💡投資アドバイザーのバイアス

投資アドバイザーとは、金融機関や投資顧問会社に所属し、投資家に助言を提供する専門家を指します。このビデオでは、投資アドバイザーが極端に楽観的な見方を示す傾向にあると指摘しています。具体的には、投資家インテリジェンス調査で楽観派アドバイザーの比率が77.5%と高水準にあり、バブルの頃と同様に買いに傾斜しすぎていると示唆しています。アドバイザーの見方が投資家の判断に影響を与えるため、こうしたバイアスを認識することが重要と言えます。

💡エリオット波動理論

エリオット波動理論は、株価の動きが特定のパターンに従うとする技術分析の手法です。このビデオでは、過去のチャートを分析して5波が完成したかもしれないとしています。これは上昇局面が終わり、大きな調整に向かうと示唆する波動パターンだと言えます。エリオット波動理論は、市場のサイクルを予測する上で参考になる手法だと言えます。

💡NASDAQコンポジット指数

NASDAQコンポジット指数は、ナスダック市場に上場する企業の株価を加重平均したものです。このビデオでは、この指数とNYA一般株式の上げ値率(アドバンス・ディクライン・ライン)が乖離してきたことを指摘しています。これは株価と実質的な上げ値率の間に相違があり、調整の可能性を示唆するので注目すべき点だと言えます。

💡コンセンサス予測

コンセンサス予測とは、アナリストの事前予測値を集計した平均的な予想を指します。このビデオでは過去のデータから、アナリストの利益予測はほとんど常に楽観的すぎると指摘しています。実際の利益は予想を下回ることが多いため、このコンセンサス予測にはバイアスがかかっているのです。そのため、投資判断の際はこうしたアナリスト予想に過度に依存するのではなく、自らの独自の分析が必要だと言えるでしょう。

💡AI関連テクノロジー企業

このビデオでは、マイクロソフト、Apple、Nvidia、Google、Amazon、Meta、Teslaなど人工知能(AI)関連のテクノロジー企業に注目しています。これらの企業は、AI分野でイノベーションを起こすことが期待されているため、近年投資家から熱い視線を浴びています。市場時価総額も巨額であり、これら一握りの企業に株式市場の運命がかかっている側面があります。そのため、これらの企業の動向を注視し、AI時代の潮流をつかむことが重要だと言えます。

💡アナリストのセンチメント

アナリストのセンチメントとは、金融アナリストの市場見通しを指標化したものです。このビデオでは、投資家インテリジェンス調査によるアナリストの楽観比率が77.5%と過去最高水準に達していることを指摘しています。楽観的な見方が強すぎると、その後、調整の可能性が高くなります。よってアナリストのセンチメント指数などで、アナリストの姿勢を測ることは、市場の方向性を予測する上で重要な情報になると言えます。

💡ギャップ

ギャップとは、株価チャートで指値注文がない空白の部分のことを指します。このビデオでは、過去のギャップが埋められずに残っていることを指摘し、株価が下落すればそれらのギャップを埋め合わせに行く可能性があると示唆しています。ギャップを分析することは、株価の下支え値を予測する上で参考になります。

Highlights

The advanced/decline line for the NYSE composite index has failed to confirm the new highs in the index, which has historically preceded important market reversals.

There is a double negative divergence developing in the ratio of new 52-week highs to new 52-week lows, which is also concerning.

A study shows that the Wall Street consensus forecast for S&P 500 operating earnings has been wrong 100% of the time from 1980 to 2016, typically overestimating earnings by an average of 19%.

The top 100 stocks in the S&P 500, which account for 71.8% of the index's market cap, are currently trading at an index-weighted forward 12-month price-earnings multiple of 27.9x, exceeding the valuation at the peak of the dot-com bubble.

The combined market capitalization of the seven mega-cap tech stocks (Microsoft, Apple, Nvidia, Google, Amazon, Meta, and Tesla) exceeds the size of China's stock market and is about double the size of Japan's stock market.

There is an unprecedented overconcentration of the market in these mega-cap tech stocks, rivaling the dot-com bubble era and the 'Nifty Fifty' in the 1970s.

Investor sentiment has hit another bullish extreme, with the Investors Intelligence survey showing a net bullish advisor reading of 77.5%, exceeding the levels seen before the 27% market decline in 2022.

There is a stark contrast between the recent bullish extremes in investor sentiment and the record insider selling seen this year, including from Jeff Bezos, Jamie Dimon, and Mark Zuckerberg.

The Elliott Wave count suggests that the S&P 500 may have topped at 5,111 on February 23rd, completing a five-wave sequence that could mark the end of a supercycle degree third wave.

There is a dramatic fading in breadth, with fewer S&P 500 issues trading above their 50-day moving average, which confirms the negative divergence in the NYSE advance/decline line.

The current move could be a final minor wave five within the larger intermediate wave five, or there could be one more push higher to complete minute wave five and the entire sequence.

The market could see a breakdown

Transcripts

hello and welcome everybody today is

Wednesday February 28th I'm Jeff huge

Chief investment officer at JW

Investment Partners and the founder of

alpha insights and this is your daily

five as most of you will know the daily

five is the show where we go through our

top five charts that are top of mind

this week uh we actually have a couple

bonus charts so stick around to see the

end uh before we begin um I just want to

give a quick heads up that we will be

publishing uh the next issue of huge

insights the big picture on Saturday

March 2nd that's uh this coming Saturday

for those of you who uh are not familiar

with our investment newsletter uh this

is a publication that comes out every um

uh the first Saturday of every month and

uh of course it's free to subscribe uh

to the newsletter via substack you can

find it at huge insights. sub stack.com

uh have it delivered directly to your

inbox um typically we do publish

following the uh the monthly NFP report

um we we've uh entitled the newsletter

affectionately huge insights the big

picture because in this newsletter we

try and address a number of key macro

factors that are affecting both the

economy and the markets um and you know

a lot of people who read our work uh you

know they like the ideas they're looking

for a way to put this to work and and we

get a lot of inquiries hey Jeff you know

how can we take your Insight and and put

this to uh to work in our portfolio and

so you know for those who want a little

bit more we also have an option to

upgrade to paid for as little as 1250 a

month this actually includes a much

deeper more granular look at our Market

forecast and our positioning

recommendations in addition to uh some

additional content that wouldn't

normally be available in the free

portion of the newsletter paid

subscribers also receive our weekly

Alpha insights idea generator lab

publication this is part of our

institutional package uh that we make

available to newsletter subscribers as

well it actually details our top

actionable trade idea each week and

provides an up dated look at some Market

commentary uh and that goes out every

Wednesday afternoon um and in addition

to that we do also provide access uh

periodically to interim bulletins that

we publish when we've got something to

say in between our regularly scheduled

Publications and some uh special video

content as well so there's a lot there

uh for 1250 a month for those who are

interested in a little bit more let's

get started chart number one takes a

look at the Advan decline line and uh

you know notes the Divergence that has

developed here this chart is actually

taking a look at the NYSE Composite

Index on the top frame this is a broad

Market proxy it contains some 2200

issues uh it includes a vast array of

both primary and secondary stocks closed

in funds preferred stocks and also about

48rs um the index actually posted a new

all-time high on February 23rd along

with the major averages and uh you know

the only thing that really has caught

our eye here is that despite that fact

the advanced decline line for nysse

Common Stocks only uh actually made its

high back on February 15 and and has

failed to confirm the new high-end price

in the index now you know famously when

this pretty well-known bread indicator

fails to confirm price action in the

broad Market it has historically

preceded uh important Market trend

reversals and and that's something that

we are concerned about right now and

we'll dig a little deeper into that as

we go through the deck uh but I also

wanted to point out also importantly uh

there is a double negative Divergence

now uh developing uh in the ratio of new

52- we highs to New 52 we lows that's

the bottom frame here and as you could

see you know that topped in uh I think

Janu or actually late January then again

around the the uh 15th of February and

now we're making another lower high so

that's that's a double negative

Divergence there here with the uh NY

Advanced decline line Common Stocks only

we've got a lower high as well that

negative Divergence is not confirming

the new highs in price and and this is a

concern because of course um these sorts

of negative divergences tend to be a

warning signal let's move on to chart

number

two chart number two is a is a study uh

this was conducted by y Denny research a

number of years ago it actually takes a

look at data from

1980 through 2016 and we've entitled the

um the chart the consensus forecast is

wrong why do we say that well um you

know the chart illustrates the

percentage change in the Wall Street uh

consensus Force annual forecast for S&P

op EPS uh and and really what it's doing

it's looking at the forecast to the

actual result it's about a 25mon period

of time uh and it looks at a 36-year

period from uh 1980 through 2016 the

reason that we say the consensus

forecast is wrong is because 100% of the

time the study shows uh that the top-

down consensus forecast has been wrong

okay looking back over that 36 years now

the consensus actually overestimated S&P

Opera earnings 78% of the time and by an

average of uh greater than

19% uh and so um you know the consensus

is is really been a very very optimistic

uh cohort if you will now uh they have

also underestimated S&P operating

earnings uh periodically but only about

22% of the time and only by an average

of just

6.7% and so you know according to S&P

Global which is our data source for um

uh the current consensus S&P op estimate

um the street is looking for 2024 and

2025 S&P operating earnings of 240 and

272 well based on the history uh that

this this group of forecasters which is

you know uh you know dozens of Wall

Street economists and strategists um and

just using history as our guide the

actual results could just as likely

prove to be

$194 this year and 220 for next year now

that's very much in line uh kind of with

what we're thinking for this year we've

actually got a published estimate of

187 and so if the consensus uh estimate

is wrong by

19% uh and overestimating you know we

could easily see 194 and you know

perhaps even worse um the interesting

thing is that earnings have been

basically flat for the past last three

years 2021 2022 and 2023 have all come

in kind of in this 218 to 220 range

effectively no growth for that period of

time uh and you know if in fact these

consensus forecasts are overly

optimistic as they typically have been

in the past um then it's quite possible

we could see five consecutive years of

flat earnings we'll have to see um stay

tuned on that one but I just want to

kind of give you a sense

of of what this um you know process is

is like over time let's look at chart

number three

27.9

times what is the forward 12-month PE

Alex uh taking a little bit of a uh you

know a tilt toward Jeopardy here or

tipping our hat toward Jeopardy um a lot

of people would look at this number and

go what are you talking about Jeff uh I

haven't heard anybody on financial uh uh

you know tele Vision talking about a

27.9 PE for the market well you know

let's just take a look at what we have

here um the S&P 500 in our view is

excessively valued right now and

excessive valuation is not a catalyst by

any means but it is a warning and what

it means is uh that an aggregate

investor sentiment is what's been

driving the price of stocks higher not

the fundamental earnings growth of the

companies that make up the stock market

so you know based upon consensus

bottomup estimates for calendar year

2024 in other words the next 12 months

uh and using data that we've acquired

from eleg data and analytics this is

what used to be refini uh and this uh

data is through last Friday's close uh

February 23rd we actually updated a

study of the forward 12 Monon price

earnings multiple that we've done for

the top 100 stocks in the S&P 500 um why

the top 100 stocks well they

collectively account for for 71.8% of

the market cap of The Benchmark index so

um you know uh that is a large

proportion of uh the the market cap of

The Benchmark uh really concentrated in

just 100 stocks and you know I I I don't

know the exact number but uh it's well

over 50% of the earnings uh for the S&P

500 are derived from those top 100

stocks I've actually read uh one point

in time it was upwards of

83% of S&P operating earnings came from

that cohort of stocks but that's a

moving Target we never know exactly how

much it it changes quarter to quarter

but you know something well above 50% so

this is a group of stocks that we must

pay attention to and and what the study

concludes is that the largest and most

influential 100 stocks in the US Equity

Market are currently trading at an index

weighted forward 12mon price earnings

multiple of 27 .9 times now that is a

high valuation the valuation multiple

actually exceeds that which attended the

peak of the.com bubble back in March of

2000 when the uh S&P 500 traded at an

index rated forward PE multiple of just

about 25 times based on the then

prevailing bottom-up consensus forward

12-month earnings estimates at the time

um but as all will know those estimates

turned out to be completely unfounded

and uh you know those earnings never

came to fruition uh in the year 2000 and

the stock market ultimately lost roughly

50% of its value over the subsequent two

and a half years um we have a u detailed

Excel spreadsheet uh that uh you know um

goes into the granularity of how we

arrive at this number and subscribers to

our newsletter will be able to access

this data uh in the newsletter on

Saturday so uh if you're not a

subscriber sign up and you'll be able to

take a deeper look at that as well um

chart number four you know there's been

a lot of discussion about the mag 7 The

Magnificent 7 this is a cohort of uh of

AI stocks institutional Darlings if you

will it includes Microsoft and Apple

Nvidia Google Amazon meta and Tesla

although you know a few of these names

are kind of losing their luster Tesla

Tesla's down some 20% a year to date

Apple was down as much as 5% on Friday

when we ran the numbers and uh if I'm

not mistaken Google was even down a

percent or so uh and Microsoft is just

barely positive uh Nvidia has been the

big winner this year of 60 plus percent

meta right behind it around 35 or so

Amazon's not been bad uh I think up

around 13 or 14 or 15% last time I

looked and so you know these have kind

of been the the drivers of uh

performance this year but you know the

prospect of a new paradigm driven by

artificial intelligence has really

captivated the minds of investors and um

you know it's it's led to a level of

Market concentration in these Mega cap

tech stocks that really Rivals uh that

of the doc uh bubble era or or even the

nifty50 back in the 1970s and that's why

we entitled this Slide the mag 7 versus

the world and uh what we've done is

we've kind of highlighted here with this

red circle you know these are the US

seven stocks that we're talking about

here and and according to this research

which was compiled by Deutsche Bank uh

the combined market cap of the so-called

magnificent 7 uh exceeds uh that of the

second largest uh stock market in the

world China so here's the US Stock

Market here's the China stock market the

second largest in the world and the mag

7 are actually larger uh by a

significant margin okay uh and uh it's

actually double the size of the third

Market you know we're at 13.1% of total

World Market Cap Japan is 6.2% that's

the third largest market in the in the

world so um you know one of these stocks

in fact uh Microsoft which is the

largest company in the world or in the

US right now uh and uh that that stock

alone is now larger than

75% of the G20 country stocks and so um

I think the real Point here is that the

overc

concentration uh of the market in these

stocks is really uh frankly

unprecedented uh the extent to which

they they Dominate and and one could

argue uh that the profits of these

companies uh now exceed you know a a

wide swath of global stock markets right

there the profits are highly

concentrated as well uh but you know

much of that profit comes from

advertising dollars and advertising

dollars is a highly cyclical business

and uh we believe that if we do see uh

an economic downturn in 2024 which is

our forecast uh we could see uh much of

that advertising Revenue come under

pressure and that would immediately uh

you know attack that that profitability

factor uh that the mag 7 has so so

proudly worn for some time now um so

another concern to just kind of keep in

mind as we take a look at what the

markets are up to uh in the next few

slides here slide number five I just

want to hit again uh investor sentiment

now you know we've been talking about

investor sentiment for sometime uh you

know uh we started to get some pretty um

incredible readings uh in December and

we've been highlighting those in in

these presentations and others that

we've been making publicly as well as in

our uh newsletters and institutional

research service but the point here is

that stenovate has again hit another

bullish extreme for the second time this

month the investors intelligence survey

of advisor saw a new bullish extreme now

net bullish advisors uh this is the

Bulls divided by the Bulls Plus the

Bears came in at 77 a half perc right up

here okay um that's the dark black line

is the survey line and so we can see

that you know it is now exceeding the

July highs by a pretty wide margin and

and recall that you know back in July uh

we we topped here uh in the S&P 500 with

that high uh level of bullishness by

advisers and that preceded an 11%

decline over the subsequent three months

in the S&P 500 um you know if we were to

set the Wayback machine to say December

of 2021 it's not shown in this chart uh

but actually this level uh now exceeds

uh that uh level that preceded a 27%

decline in the S&P over the subsequent

nine months from uh January 2022 through

October of 2022 and so um it's quite

concerning to be uh to be fair U now the

investors intelligence survey really

just complements uh the results that

we've been discussing over you know

these past several weeks and months uh

surveys that we've talked about include

the name exposure Index this is a index

of of professional investors that you

know basically indicate the extent to

which they are net long equities and and

that has really been hovering up in the

uh you know 90s percent it got it got as

high as 102% in late December and has

come down and actually made a lower high

so we're seeing a negative Divergence

there the fear in greed index the CNN

fear and greed index we've talked about

quite a bit as well that's been hovering

in extreme greed territory off and on

for the last two months here since late

December through late February I think

yesterday it closed out at

78% it topped in late December I think

December 26th at uh 80% has yet to make

a new high so again slightly diverging

negatively even as the major averages

make new highs and then also we've been

talking about another survey consensus

Inc which posted its highest level level

uh really uh since the bare Market began

in uh January of 2022 recently and and

so you know that's just to name a few

there are many others uh you know the

vix is fear gauge as well and that you

know shows a lot of complacency hovering

down in the you know low to mid- teens

recently and so you know the real issue

here is that these recent bullish

extremes exhibited by all of these

surveys kind of represent a stark

contrast when we consider consider it in

the context of the record Insider

selling that we've seen this year most

recently Jeff Bezos Jamie Diamond and

Mark Zuckerberg sold n billion dollar

worth of stock these are three guys that

rarely ever sell stock uh it's been

years since Jamie Diamond has sold stock

and uh for him to sell stock is is

potentially uh you know an indication

that maybe maybe he doesn't think the

Market's got much higher to go uh you

know maybe um Zuckerberg Bezos who knows

the reasons that they're uh they're

selling stack maybe Bezos wants to

launch another rocket into space Maybe

Zuckerberg uh you know has a new project

that he wants to work on we don't know

the reasons there's lots of reasons uh

that these guys sell uh but you know

there's only one reason that they buy

and that's that they think the Stock's

going higher and I don't see a lot of

Insider buying right now in fact The

Insider sell transaction ratio hit an

all-time record Extreme earlier this

year at4 5 to1 uh that was in late

January and and that was kind of a

shocking figure you know I think we

talked about it in one of our

presentations recently so um let's jump

to our first bonus chart here um bonus

chart number one really takes a look at

um the S&P 500 and our Elliot wave count

dating back to October 13 of 2022 uh

where we started we labeled this uh

primary wave for that's a primary wave

for loow so this entire channel here is

primary wave five and and we've counted

it at you know kind of an exhaustive

level we've got you know one two three

four five that's intermediate wave one

we can count five waves up we get

intermediate wave one that topped on uh

December 13th uh then it was followed by

an

ABC flat corrective wave form to get

intermediate wave to that bottomed on uh

Actually March 13th uh last year we got

a very Torrid rally here uh into July

all will remember we got a big breakout

I think right around here when uh Nvidia

first told us about their new AI chip

and and how great things were going but

you know all we were able to do is count

one two three four five waves up to

complete intermediate wave three on July

27th and that was followed by an

ABC zigzag corrective wave form to end

intermediate wave four on October 27th

since that time uh we've seen kind of

this exhaustive move here uh this first

initial fora here we thought was topping

here um but we were wrong that was just

minor wave one up the pullback counts

best as minor wave two we get another

five wve move to the upside here and

that counts best as minor wave three and

what's Happening Here is we're now uh

you know testing this trend line this

trend line is the trend line that

connects um uh primary wave four to

intermediate wave four and then we take

the parallel of that trend line and

attach it to uh the the intermediate

wave three high on July 27th and that's

where this comes from and what we've

seen is we've penetrated that and then

moved back below it in three waves a b c

we're counting this uh as as minor wave

four which which means that this last

most recent move up is very likely minor

wave five to complete uh intermediate

wave five which would then complete

primary wave five cycle wave five and by

extension if we're correct super cycle

wave three uh we believe that the market

may have topped at S&P 5111 on uh

February 23rd that was last Thursday's

intraday high now we've seen a little

bit of a pullback but not enough to give

confidence in that count uh one thing

that does give us confidence is this

dramatic uh you know fading in breadth

okay what we're looking at here is the

uh S&P 500 uh issues that are trading

above their 50-day moving average and

that actually peaked in early January

and from that early January High we've

seen nothing but lower highs emerge as

the market has pushed to its new

all-time highs this negative Divergence

in breath kind of confirms the negative

Divergence in the nysse Common Stocks

only ad line that we talked about at the

outset of this discussion and and gives

us a lot of reason to believe that the

market is really just running on fumes

at this point let's take a look at bonus

chart number two uh what we've done here

is we're just really going to take a

look we're going to magnify this this

last move up this this minor wave um

should say intermediate wave five uh and

we're going to take a look at the

subdivisions of that a little bit more

closely so starting from that um uh

October 27th low here we count one two

three four five to complete minor wave

one up minor wave two down one two three

four five and we saw some sub dividing

here one two 3 four five as well to

complete minor wave three now we think

think this is an ABC to complete minor

wave four and this pushup could be minor

wave five to end the entire uh Series

right uh to to top the market at five

degrees of trend at least five degrees

of trend now where we could be wrong is

that uh it's possible minor wave four

ended here okay and if minor wave four

ended here as as per the alternate uh

count line then this is probably uh

minute wave one this is probably minute

wave two this would be minute wave three

minute wave four and we have one more

push higher uh to complete minute wave

five and that would then end minor wave

five intermediate wave five primary wave

five cycle wave five and by extension

super cycle wave three if our counts

correct again we show a serious momentum

Divergence from the beginning of this

rally to where we topped most recently

and and of course as the markets pushed

up even further

uh momentum is really kind of flagged

here and so you know at the end of the

day we think the the best way to

consider uh where we are in the market

is one of these two counts we either

topped Thursday at S&P 5111 or we're

going to top with one more push higher

now what could cause that well there's

some additional economic data coming out

this week uh we will get the uh the pce

data the core pce number is expected to

be a little hotter than uh you know it

has been in recent uh uh months uh

that'll be reported tomorrow morning

let's say we get a little bit better um

uh showing from the pce that could be

what it takes to push things up and to

top in in kind of what I would call the

final kind of uh throwover and and what

we're really looking for I guess to

determine whether or not we've actually

topped is we want to see uh if we push

to a little bit higher high a break down

below about

4920 okay this this prior low right over

here and if we could take that out on a

daily closing basis uh sustainably right

uh and even from current levels we may

you know get a worse number tomorrow

from the PC and it just accelerates

things lower right U we'll have to wait

and see but a break below

4920 would be the initial evidence to

suggest that top is in uh it takes this

little throw over here that we've been

talking about and brings us back into

the channel and and finally you know we

we've marked all of these open chart

gaps okay so they begin at 4981 4907

4802 we think once we break

4920 these should start to fall like

dominoes we'll start to see uh the

market close all of these open chart

gaps all the way down here to 3583 the

open chart Gap that dates all the way

back to uh October 13 um our view is

that this top is going to prove to be a

durable top and that the market should

have uh should begin what we believe

will be a multi-year if not decad long

supercycle degree uh corrective waveform

uh which should coincide with you know a

US recession and Global recession and

and a potential financial crisis uh and

uh we're going to talk about where we

think that financial crisis is emanating

from uh in the newsletter one of the

areas that think uh will will be uh a

clear driver of it is the uh the lack of

liquidity and a lot of people look at

the

Chicago uh fed's uh Financial conditions

index to determine the level of stress

in the financial system but we've found

a couple of cracks that are starting to

develop and we think liquidity is about

a mile wide and inch deep right now and

uh we think that could be what really is

the problem uh for Equity markets going

forward so with that I would like to uh

just uh offer up uh my contact

information if anybody wants to follow

up you can always check out our website

at

www.jw investment.com send us a note if

you like uh you can also follow us on

Twitter at Alpha insights and of course

check out our newsletter on substack

it's huge insights. substack do.com

thanks a lot for watching today and best

of luck

Trading