[Editor's Note: As Money Morning Investment Director Keith Fitz-Gerald's market analysis demonstrates, success as an investor requires knowing when to act.

But it also requires knowing where to look.

Like under the Eiffel Tower.

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And a tiny U.S. company is poised to profit from this $2.8 trillion cache of crude. Opportunities such as this are the kind of potential profit plays that we focus on in our monthly affiliate newsletter, The Money Map Report. This publication tracks global money flows, and where those capital flows intersect with some of the most powerful economic and financial trends at play today.

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Back in mid-June, more than 75% of the investors responding to a CNNMoney poll said they were planning to buy stocks – many of them aggressively.

Of the 41,572 people polled, it now looks like those 31,179 bullish investors kept their word.

The Standard & Poor’s 500 Index has zoomed 15% since those investors were polled (and 53% from its March 9 market bottom).

Let’s face it. A 75% bullish inclination is a disproportionately high percentage. It’s way out of the norm.

What those 31,179 bulls are telling me is … well … we’d better watch out. Statistically, the individual investor excels at making the wrong decision at precisely the worst possible time. I view this survey as yet more evidence that the “herd” may once again be heading down the wrong path.

After the collapse of Lehman Brothers Holdings Inc. (NYSE: LEHMQ) investors yanked

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I yesterday published a short post on “When will the rally end“, quoting Ned Davis’s indicators. It also makes for interesting reading to consider Bob Precther’s views. Prechter of Elliott Wave International, who is often wrongly described as a permabear, in late February said “cover your shorts” and predicted a sharp rally that would take the S&P into the 1,000 to 1,100 range. With that prediction having come to pass, Prechter is now saying, as reported by Yahoo Finance, Tech Ticker, investors should “step aside” from long positions, and speculators should “start looking at the short side”.

“The big question is whether the rally is over,” Prechter says, suggesting “countertrend moves can be tricky” to predict. But the veteran market watcher is “quite sure the next wave down is going to be larger than what we’ve already experienced,” and take major averages well below

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I published a post a few days ago on the issue of whether stock markets were in a secondary (i.e. cyclical bull) or primary bull market.

I quoted a research project by Ned Davis (Ned Davis Research) in which he identified seven dimensions one could use to compare the March 9 low with secular lows of the past. The research showed that only one of the seven criteria indicated a secular bull was in place, whereas three were neutral and three were bearish. Although Davis believed the nascent rally had more upside potential, he concluded, like Richard Russell, that we were dealing with an extended rally (cyclical bull phase) within a secular bear market.

Davis has now turned his focus to what criteria would signal that one should exit the rally. His yardsticks were reported by Mark Hulbert on MarketWatch and

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Ever since Richard Russell (Dow Theory Letters) called a “Dow Theory bull signal” last Thursday, the debate has been rekindled as to whether the US stock markets are experiencing a primary (secular) bull market or a rally within a primary bear market, i.e. a secondary or so-called cyclical bull phase.

As mentioned previously, Russell views the March 9 low as a secondary low, saying: “We are now in a cyclical bull market as opposed to a secular or primary bull market. In effect, we’re in an extended bear market rally. The true bear market bottom lies somewhere ahead.”

Irrespective of terminology, 64% of the readers of the Investment Postcards blog see the current phase as one characterized by “irrational exuberance”, as cleaned from a quick poll a few days ago.

As always, there are various signals pointing in different directions. The 200-day moving average of

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Countless studies demonstrate that dividend-paying stocks outperform non-payers by a wide margin. From 1972 to 2006 dividend-paying stocks returned an average of 10% annually versus 4% for non-dividend payers, according to Ned Davis Research. Going back to 1926, other studies confirm almost half of the S&P 500’s return was due to the dividends paid by the companies in the index.

So, I’ll take Bill Gross’ recommendation one step further. Forget now. Dividend-paying stocks ALWAYS deserve a place in your portfolio.

Yet, in this market, it’s increasingly difficult to find reliable dividend stocks.

“This is going to be the worst [dividend-cutting year] in 50 years,” Howard Silverblatt, Senior Index Analyst at Standard & Poor’s, predicted in January. So far he’s right with industry titans like General Electric and Dow Chemical announcing cuts.

Keep in mind, Dow Chemical maintained or increased its dividend every year since 1912. That means conditions this year are worse for the company

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Throughout US history, the most dangerous time for stock markets has been when one party controls the White House and Congress, says Keith Fitz-Gerald. And when you account for inflation, it doesn’t really matter whether the Democrats or Republicans are in the driving seat.

This from Money Morning:

With the whipsaw trading we’ve seen of late, it appears that the U.S. financial markets are already chewing through the post-election honeymoon. I have to say that I, for one, am relieved that’s the case because it signals that the markets are already returning to normal.

I realize it may not feel that way, but there’s one very important thing to remember: We nearly always seem to receive the best news near, or at, market tops, and the worst news near, or at, market bottoms. Although that seems contradictory, it actually makes sense. And investors can take some solace in the fact that

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Throughout US history, the most dangerous time for stock markets has been when one party controls the White House and Congress, says Keith Fitz-Gerald. And when you account for inflation, it doesn’t really matter whether the Democrats or Republicans are in the driving seat.

This from Money Morning:

With the whipsaw trading we’ve seen of late, it appears that the U.S. financial markets are already chewing through the post-election honeymoon. I have to say that I, for one, am relieved that’s the case because it signals that the markets are already returning to normal.

I realize it may not feel that way, but there’s one very important thing to remember: We nearly always seem to receive the best news near, or at, market tops, and the worst news near, or at, market bottoms. Although that seems contradictory, it actually makes sense. And investors can take some solace in the fact that

...

With the whipsaw trading we’ve seen of late, it appears that the U.S. financial markets are already chewing through the post-election honeymoon. I have to say that I, for one, am relieved that’s the case because it signals that the markets are already returning to normal. I realize it may not feel that way, but there’s one very important thing to remember: We nearly always seem to receive the best news near, or at, market tops, and the worst news near, or at, market bottoms. Although that seems contradictory, it actually makes sense. And investors can take some solace in the fact that the mounting tide of bad news is an important part of the bottoming process. Speaking of which, studies show that the most dangerous time for American markets (and U.S.-centric investors) is when one political party controls all the marbles. ...

A Fidelity study that took stock market performance trends since 1948 found some remarkable trends. Presidential election calendar years have historically experienced solid stock returns. Since 1948, election years presided over by a Democratic administration saw an average market return of 15.4%. When Republicans were in power, the average return was 11.4%. Performance in years of Republican and Democratic presidential electoral victories rated Republicans at 12.5% and Democrats at 14.0%. This presidential cycle is unique because of the sweeping victories for the Democrats in both the House and Senate. According to Ned Davis Research, between 1901 and 2006, the market has fared best when Democrats control Congress.

Now, although Obama had joked about being from Krypton at the 63rd Annual Alfred E. Smith Foundation Dinner in New York last month, he certainly is no Superman. Taking a closer look at the presidential cycle and stock market returns, we see a pattern

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