Secular Bull Markets
The current secular bull market has astonished everyone, including this trader, as records are broken on a daily basis that no one alive can remember. Hell I’ve been trading for thirty years, having enjoyed the carnage and after math of Black Monday, 1987. Even CNBC’s coverage of the 30 year anniversary seems quite comical three months later. However, one common thread that we see unfolding in a similar fashion is depicted in the chart below.
Summary
Secular Bull – Present Day
In each case, a long period of consolidation (15 years average), which led to a secular bull market lasting more than 16 and 18 years respectively. The current secular bull is starting year number 6. Additionally, we saw what the 1986 tax-reform produced. Sure, we had the 1987 crash soon thereafter and we took three years to best that high, but we then went on the higher highs for another 10 years.
Secular Bull and the Current Environment
We do realize there are periods of consolidation and drawdowns, so we aren’t perma-bulls. That said, where are we in the current cycle? Do you see a sell signal? Me either.
The high low percent chart above would need to produce a sell signal for us to start thinking bearish analogies. The upper line chart would need to produce a bearish cross at a minimum and the histogram would need to drop below the zero-line to issue a confirmation.We see neither remotely possible in the next few trading days.
With this in mind we keep adjusting our stops higher, watching for institutional sentiment and breadth to tell us us when to start thinking bearish again.
This is a short synopsis, so if you want the full run-down, join us via LIVESTREAM today at 9:20 AM.
Happy Trading and Happy Fry-Day,
Vinny
https://theclosingprint.com/CV_Blog/santa-claus-rally-january-effect-stocks/
Disclaimer: Do your Own Research
Our content is intended to be used and must be used for informational purposes only. It is very important to do your own analysis before making any investment based on your own personal circumstances. You should take independent financial advice from a professional in connection with, or independently research and verify, any information that you find on our Website and wish to rely upon, whether for the purpose of making an investment decision or otherwise.
Investment Warnings
We would like to draw your attention to the following important investment warnings. The value of shares and investments and the income derived from them can go down as well as up; Investors may not get back the amount they invested – losing one’s shirt is a real risk; past performance is not a guide to future performance.