The Wait

I tweeted the message above on Monday afternoon.  I am certain that many that follow my work were saying that the ‘perma-bull’ was finally turning.  I really don’t like the term perma-bull.  It comes as the counter of a perma-bear.  But the context is what gets me.  It is easy to recognize a perma-bear in a raging 9 year long bull market.  A perma-bull in a bull market may just be a trend follower.  You should have been bullish from 2009 through to now!

It is the turning points that often bring the confusion and the labels.  And it comes from a misunderstanding of investment horizon or how the investor is describing the market.  To a short term trader the downturn at the beginning of October would constitute a change of character in the market.   It would take something like the break of the 200 day SMA for an intermediate or swing trader to jump on board.  And for the longer term holder, a new long term low, like a move under the February would signal a turn in the market.

For each of these market participants the 2018 market would be described totally differently.  A two way trading bonanza for short term traders.  A chopfest for intermediate traders.  A consolidation, possibly topping, for long term holders.  So how do you cut through it all?  Ask questions about timeframe, form your own plan, manage risk consistently in good markets and bad ones.

This may turn into a bear market that all can agree on.  But I doubt it is there yet.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.