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The Pros Are Getting Defensive & You Should Be Too!

Near market tops, the pros "say" one thing on financial TV and "do" another. It's why I love watching what the charts

are saying because that's what they're "doing".

Right now, they're still coming out on CNBC, Bloomberg TV and Fox Business and they're saying "buy the dip" and "this rally still has a couple more years to run", etc. Why? They need you to be confident buyers during this time because they need to be sellers...and all sellers need avid buyers!

It's a tactical move. Yes, I question the morality of it, nonetheless, it's what they do.

So right now, they're encouraging people to buy overvalued stocks that the KNOW are at such high prices (relative to their collective earnings) that crashes have come at these levels, in the past.

They want to transfer that risk to you, their new buyers. They push the envelope until they feel the risks vs. the potential rewards are flipped and then they "sell you" on the idea of buying. Yet, I say...you should be getting defensive right now, just as they are getting defensive.

As they're lightening up on stocks, broadly...they're buying into defensive assets like metals, particularly gold. How do I know? I'm watching what they're "doing" vs. what they're saying. It's the "big boys" that move markets. And charts leave a trail of proof as to what they're doing.

All throughout 2016-present they've been buyers of gold. How do we know? Gold has continued to put in "higher lows" and that only happens when buyers get more aggressive on dips and buy much more than is sold. Also, we see the major long-term moving averages heading higher as well on the weekly, 10-year chart below.

Additionally, we see the RSI and MACD firming up and we also see further proof of institutional buying by the growing buy spikes that are in the volume part of the chart (emphasized by the green, inclining line below).

When the breakout above the $1378-$1400ish region occurs (and sustains its breakout above that zone), then gold will be producing long-term, "higher highs". This will unleash the next phase of gold's uptrend which will take it up to the $1800-$1900 per ounce area.

What will likely fuel this breakout? A declining stock market is the most likely catalyst. Further interest rate hikes, tariffs, burgeoning debts, etc. are all beginning to weigh heavily on stocks in general. And this could fuel gold's next rally higher.

So as large institutions are secretly getting defensive. You should be too!

If you don't know how best to position your portfolio defensively, come join us in the Logical Investor newsletter, found in the Premium tab on www.seanhyman.com. That subscriber-based newsletter will give you exact buy/sell investing recommendations that we'll be holding over the next 2-4 years. Right now is a crucial time in history. Dodge the next bear market in stocks. Don't live through a 2000 or 2008 bear market again the way you did before. Instead, learn the smarter/wiser way to use a bear market for your benefit rather than to your detriment.

God bless!

This is one of many reasons not to get your investment advice from TV. The amount of commentary they have to produce on a daily basis makes the commentators continuously have to speculate on what might happen. Looking at the facts and data of what's happening over time is a much better approach. Thank you, Sean, for giving us that fact base that helps us make good investment decisions!

Thank you. Yes, they haven't been promoting gold but they've been investing in it (quietly) and its been going up. And during the commentary, you'll always hear so much content on both sides of an argument that you'll be left confused. Plus, the commentary is mainly for that one day. That's why one day you turn on the news and its all negative slanted. Then you turn it on the next day and they're all of the sudden bullish. It's fickle. And a lot of it has become financial "entertainment" these days with "Fast Money"...the lightning round, etc.