PREDICTIONS FOR THE NEWYEAR
GREG DIAMOND, CMT TEN STOCK TRADER
DAN FERRIS STANSBERRY INVESTOR HOUR EXTREME VALUE
2021 will look a lot like 2020 with a bias to the upside in stocks. There will likely be double-digit gains for the major indexes. However, rather than just a smooth ride higher, this upside will be met with extreme bouts of volatility throughout the year. 2021 is likely to mark stocks’ last move higher before a violent multiyear correction begins. Record short positioning in the U.S. dollar and bonds will be a catalyst for much of the volatility we will see in the first quarter of 2021. Gold and silver are likely to underperform. Bonds will reach a new high in 2021, and this could mark a major, long-term top in the bond market. Caterpillar (CAT) will hit $275 a share in 2021. Twitter will not trade above $75 a share in 2021.
Regular Stansberry Investor Hour listeners know I don’t do predictions... It’s a fool’s errand, and nobody is consistently good at it. But that doesn’t mean investors shouldn’t still spend a fair amount of time contemplating the future. That’s why I give listeners my “Top 10 Surprises” at the beginning of each year. They’re not predictions... They’re potential market developments that current sentiment and asset price trends don’t appear to be thinking about. My No. 1 surprise for 2021 is a great example... It would surprise the heck out of investors if the S&P 500 Index fell more than 20% in one day. Stock exchange policy is to close down when the market is down 20%. So by definition, just about everybody holding stocks would be very surprised if the market fell more than 20% in one day. I don’t care about the rules. I know one day, sooner or later, the folks running the exchanges can and will find themselves in a situation where the market drops faster than they ever imagined, making it impossible to react until it’s fallen more than 20%. At this point, I’m willing to bet it would surprise everybody but me!
2021 is likely to mark stocks’ last move higher before a violent multiyear correction begins.
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January 2021
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