Chris Ciovacco

About the Author Chris Ciovacco

Chris Ciovacco is the founder and CEO of Ciovacco Capital Management (CCM), an independent money management firm serving individual investors nationwide. The thoroughly researched and backtested CCM Market Model answers these important questions: (1) How much should we allocate to risk assets?, (2) How much should we allocate to conservative assets?, (3) What are the most attractive risk assets?, and (4) What are the most attractive conservative assets? Chris is an expert in identifying the best ETFs from a wide variety of asset classes, including stocks, bonds, commodities, and precious metals. The CCM Market Model compares over 130 different ETFs to identify the most attractive risk-reward opportunities. Chris graduated summa cum laude from The Georgia Institute of Technology with a co-operative degree in Industrial and Systems Engineering. Prior to founding Ciovacco Capital Management in 1999, Mr. Ciovacco worked as a Financial Advisor for Morgan Stanley in Atlanta for five years earning a strong reputation for his independent research and high integrity. While at Georgia Tech, he gained valuable experience working as a co-op for IBM (1985-1990). During his time with Morgan Stanley, Chris received extensive training which included extended stays in NYC at the World Trade Center. His areas of expertise include technical analysis and market model development. CCM’s popular weekly technical analysis videos on YouTube have been viewed over 700,000 times. Chris’ years of experience and research led to the creation of the thoroughly backtested CCM Market Model, which serves as the foundation for the management of separate accounts for individuals and businesses.

The Market’s Next Obsession

Mark Your Calendar

Over the past several months, Europe has been dealing with low inflation and the possible threat of deflation. The market will be paying close attention between now and the next European Central Bank (ECB) statement. From Bloomberg:

The European Central Bank’s public debate over buying government bonds is reaching a climax. After weeks of argument about quantitative easing in speeches and interviews, officials have just a few days left before a conventional quiet period starts ahead of their Jan. 22 policy meeting. Adding to the intensity, a European court opinion is due that could color any program.

Big Moves Often Follow

While the interest rate vs. U.S. growth debate has weighed on stocks in recent months, the sideways action in U.S. stocks (see chart below) has been caused, in part, by ongoing concerns about the European economy.

Given the sideways nature of the typical U.S. stock in recent months, this week’s video takes a historical look (1981-2014) at indecisive markets and answers the question:

What typically happens next?

The first part of the video looks at the present day market (retracements, patterns, trends). The historical review of indecisive markets begins at the 7:00 mark.

 

Investment Implications – The Weight Of The Evidence

The big picture for equities still looks favorable, but stocks have little margin for error in the next few weeks. If the S&P 500 (NYSEARCA:SPY) breaks its recent lows (1992 & 1972), the risk-off case will gain some additional traction. Just as the reaction to the Fed is often binary, the ECB’s January 22 announcement could send equities flying higher or into a tailspin.