Dear Reader,
Over the last several months I have been an unapologetic bull.
However if you’ve been reading my emails the last 2 weeks or so you know I’ve started getting more and more cautious because of the consolidation of growth into the large cap tech stocks…
The FAANG+M stocks.
Now, over the last 2 days we have seen substantial divergence in the indices.
At yesterday’s close the Dow was up slightly (.13%) but the Russel 2000 collapsed 1.63%.
Today as I write this the Dow is down slightly (.22%) while the Nasdaq and the Russel are each down well over a point.
To me this is a sign that we may be headed into a bear market…
And even if the bull keeps running I believe it’s going to be more and more challenging to find good trades.
That’s why in Options360 we are taking a very conservative approach right now.
As I said yesterday, when the generals (FAANG+M) are advancing across the field faster than the soldiers, eventually they need to let the soldiers catch up.
Since all of the gains in the indices are focused on FAANG+M, if they slow down – or correct- the indices will fall.
Will it be a correction or a new bear market?
I don’t know. Maybe the Fed won’t let it happen at all.
Either way, it’s time for patience and caution.
That’s how we are approaching things in Options360. You’re welcome to join us for just $19…
It’ll be the best money you ever spent!
To Your Success,
Steve