Summary
Phil Anderson reviews the Decade Cycle and 7-Year Cycle as frameworks for timing long-side stock trades, then evaluates the 2023 Roadmap against actual Dow Jones price action through August. He concludes with a practical walkthrough of how he identifies tradeable breakouts on the ASX, contrasting stocks with overhead resistance against those breaking to all-time new highs, and notes structural reasons why ASX breakout trading is harder than in US markets.
Key Claims
- The Decade Cycle shows years ‘1’ and ‘2’ are typically bear markets; conditions improve from year three onward — confidence: high (repeated across multiple PSE emails)
- US markets have tanked every 7 years: 2022, 2015, 2008, 2001, 1994, 1987 — confidence: high
- 2022 fell just after mid-cycle of the real estate cycle, making it a predictable year to watch for a market decline — confidence: high
- The 2023 Roadmap (prepared at start of year) correctly anticipated a late Feb/early March low and an August low — confidence: high (author claims actual Dow confirms this)
- Breakouts into all-time new highs are preferable to breakouts from congestion zones, because overhead resistance from prior buyers causes selling pressure — confidence: high
- Australian listed companies pay out a higher percentage of earnings as dividends than other markets due to tax laws (franking credits context implied), which suppresses price growth and makes breakout trading harder on the ASX — confidence: high
- The Australian accumulation index (dividends included) has tracked more like US markets — confidence: medium
- A pre-Christmas rally is anticipated for the remainder of 2023 — confidence: medium (author flags uncertainty: “Let’s see”)
- ETFs on the ASX now allow traders to access a wide range of markets, including US exposure, without needing to trade individual stocks — confidence: high
Mex Pete References
None.
Stock Picks / Signals
- Karoon Energy Ltd (ASX: KAR) — Weekly chart shows a breakout above 2.45 (prior congestion zone). Phil notes interest in the move but flags concern: monthly chart shows significant overhead resistance from prior years of falling prices. No explicit buy signal given; presented as a cautionary example of a less-ideal breakout.
- Seven Group Holdings (ASX: SVW) — Presented as a preferred breakout setup: price approaching or closing above a line-up of prior all-time highs (circled on chart). No explicit entry price, stop loss, or price target stated. Framed as the type of breakout Phil looks to buy.
Predictions / Forecasts
- Anticipated late Feb / early March 2023 low — confirmed per author (actual Dow chart shown)
- Anticipated August 2023 low — confirmed per author (actual Dow chart shown through August)
- Anticipates a reasonable market finish into December 2023 with a pre-Christmas rally — forward-looking as of email date, no specific price target given
Notable Quotes
“If the stock market news ever hits the front page of the newspaper, do the opposite.”
“Much better to look for breaks into all time new highs.”