Earnings season is off to a rough start. … According to research firm FactSet, analysts expect the S&P 500 to show a 2.1% decline in third-quarter profits. This would be the sixth straight quarter that earnings have fallen. …
Yesterday, the S&P 500 plunged 1.2% on the flood of weak earnings data… It was one of the worst starts to an earnings season since the bull market in U.S. stocks began seven years ago. …
Time will tell if this is the start of something big or just a routine selloff. We encourage you to prepare either way. You can start by getting out of expensive stocks. They’ll crash harder than cheap stocks if there’s a major selloff.
You should also avoid companies that will struggle to make money if the global economy runs into serious problems. We suggest you steer clear of retailers, airlines, restaurants, or any other company that depends on a strong U.S. consumer. …
You can also profit from a coming crash by shorting stocks…
Global banking giant HSBC just issued a “RED ALERT.” … Business Insider reported this morning:
In a note to clients, Murray Gunn, the head of technical analysis for HSBC, said that he is now on “RED ALERT” for an imminent sell-off in stocks given the price action over the last few weeks.
Business Insider continued:
In late September, Gunn said the stock market’s moves looked eerily similar to just before the 1987 stock market crash. Of note, Citi’s Tom Fitzpatrick also highlighted the market’s similarities to the 1987 crash just a few days ago. On September 30, Gunn said stocks were under an “orange alert” as they looked to him as if they had topped out.
And now, given the 200-point decline for the Dow on Tuesday, Gunn said that the drop is here.
“With the US stock market selling off aggressively on 11 October, we now issue a RED ALERT.”
In other words, the stage is set for another “Black Monday.” As you probably know, that was the darkest day in the history of the U.S. stock market. The Dow Jones Industrial Average plunged an incredible 22.6%.
According to Gunn and his team, the critical level for the Dow is now 17,992. For the S&P 500, it’s 2,116. If stocks dip below those levels, we could see a major selloff. Business Insider continued:
“As long as those levels remain intact, the bulls still have a slight hope,” said Gunn.
“But should those levels break and the markets close below (which now seems more likely), it would be a clear sign that the bears have taken over and are starting to feast. The possibility of a severe fall in the stock market is now very high.”
Most investors aren’t prepared for this. … If you haven’t already “crisis-proofed” your wealth, we encourage you to take action immediately. You can get started by signing up for The Casey Report. Click here to learn more.