Quick post here...busy studying for CFA exam.
Bears have had every chance to take this market down: 1) extreme IT overbought condition in early May 2) A huge spike in bond yields 3)Plunging dollar.....but yet they can't close the deal.
Now....the market has just about worked off it’s IT overbought condition without much damage done.
Markets have gone sideways and there's a triangle forming in the chart which suggests a breakout one way or the other is coming....and it looks like up to me. I'm still seeing plenty of skepticism/cautiousness. Sure, there's more bulls out there compared to a few months ago but that's only natural after a 30% pop. There are still plenty of skeptics especially amongst the retail crowd. Everyone seems to be bashing the "green shoots" and everyone wants the 10% pullback it seems. And bears are still as angry as ever when the market rallies. Sorry bears, you can jump up and down like a 4 year old, yell, spew your dogma and swear at your computer all day...the market won't give a rat's ass and will punish sheep-like behavior...and just like in early 2002...once the market has shaken out and bankrupted enough bears then the downward slide will resume. Until then...it will likely be pain, pain and more pain for the dogmatists.
If the SPX breaks 870, then it would make sense to join the bears for more of an IT time frame. Until then, the bulls are in control and playing the bear side is only optimal for 1-3 days max.
Investor sentiment as measured by the Investor's Intelligence and American Association of Individual Investors is neutral and never did get to giddy levels of bullishness for even 1 single week since this rally began.
The consensus opinion seems to be that we get a pullback during the summer followed by a launch in the fall. Like I said before....don't count on this playing out. A more likely scenario is the opposite or a massive pullback in the summer.
I'll be providing more substance in future posts....after this damn exam is over in about a weeks time.
Yeah, all the best man!
ReplyDeletethanks....how's it comming along for you?
ReplyDeleteMake sure you practice as many IPS questions as possible...everyone gets killed on them it seems.
yeah, IPS questions are tricky. Rather subjective when it comes to risk tolerance.
ReplyDelete