Hello everyone. This week
proved interesting for sure. Everything looked dire in the early part of
the week, until the Federal Reserve announced on Wednesday their decision to
end the uncertainty about its quantitative easing strategy, which the market
clearly applauded. The latter two days of the week resulted in big up
moves.
As I mentioned previously a few
times, uncertainly is the market’s biggest enemy, and having clarity on the
Federal Reserve’s tapering plan removed a lot of questions on people’s minds,
allowing the market to continue on its’ current trajectory.
Things certainly continue to
remain frothy. In fact the latest Investors Intelligence survey shows
just 14.3% of newsletter editors as still being bearish, the lowest level since
March 1987. This is not an indicator that can be used to trade with, but
it is unsettling the level of bullishness for sure. As I mentioned in the
past few weekly emails, the market can remain elevated or ‘overbought’ for much
longer than anyone can predict, so trying to argue or time the market based on
overbought indicators tends to be a sobering experience.
Obviously,
looking over history, we won’t continue higher forever, we are clearly overdue
for a correction, and it is important to remember the historical facts and not
get too bullish. The market will correct, but it might still have
significant more upside before it does, time will tell.
The next few weeks will be
interesting as most investors take the time off. The markets can move
very easily and manipulation is usually highest in these low volume time
periods. I look forward to seeing if we can continue this upward directory
through the end of the year. It certainly seems like that is the path we
are on with so much bullishness.
Hope you have a wonderful and safe weekend.
Respectfully,
Randall Mauro
Resnn Investments, LLC
Our market wrap is published weekly, sent via email on Friday after the market close, with alerts sent occasionally mid-week in particularly volatile times. To sign up for this free service, please visit our website at http://resnnInvestments.com
Our market wrap is published weekly, sent via email on Friday after the market close, with alerts sent occasionally mid-week in particularly volatile times. To sign up for this free service, please visit our website at http://resnnInvestments.com
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