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The Cloud Hanging Over the Bull Case

The Cloud Hanging Over the Bull Case

Posted On July 12, 2021 1:51 pm
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You know that I am an unapologetic bull on this market right now.  

While we technically were in a bear market for a few weeks last year, the truth is that this bull market is really a continuation of the 10+ year bull market that ended last year. 

The Fed policies artificially pulled us out of the bear market in record time, and the bull picked up its run. 

Hop on board my Options360 Concierge Trading Service for the crazy-low price of $19 for the first month. It’ll be, as our trading experts put it: “The best $19 you’ve ever spent.”

That’s not a criticism of the Fed, it’s just an acknowledgment that even though we are. technically, only a year into this bull market it is behaving like a very old bull market…

And that includes the deterioration in market breadth and the divergence of performance across sectors.

In other words, we are seeing a few large-cap stocks drive the indices up, while most of the stocks on the indices are falling.

This happens because the indices are weighted by market cap, so bigger companies – like the FAANG stock – have a greater effect on where the indices go.  

In an unweighted index, we would see the market falling right now. 

If that continues, it is a strong sign that the bear could come out to play.  

While I am still bullish, I am not married to any position in this market.  

If (When) things change and the market shows me that it’s turned around…

I will be bearish.  

Trading and philosophy do not go hand and hand.  That’s why it can be so hard to trade…

“The market SHOULD be doing this or that.”   

You can’t deposit “should” my friend, you can only deposit profits!

I never get attached to a philosophical position in Options360.  That’s why the worst year we have had since we launched in 2015 is 39%.  The best year was 122%.  

If our worst year ever delivered almost 40% ROI to subscribers – don’t you think it’s about time to discover how you can enjoy that kind of performance

To Your Success

Steve

PS. I’m watching some exciting positions in Options360.  Make sure you are included, it just takes $19.  

 

About author

Steve Smith

Steve Smith have been involved in all facets of the investment industry in a variety of roles ranging from speculator, educator, manager and advisor. This has taken him from the trading floors of Chicago to hedge funds on Wall Street to the world online. From 1987 to 1996, he served as a market maker at the Chicago Board of Options Exchange (CBOE) and Chicago Board of Trade (CBOT). From 1997 to 2007, he was a Senior Columnist and Managing Editor for TheStreet.com, handling their Option Alert and Short Report newsletters. The Option Alert was awarded the MIN “best business newsletter” in 2006. From 2009 to 2013, Smith was a Senior Columnist and Managing Editor for Minyanville’s OptionSmith newsletter, as well as a Risk Manager Consultant for New Vernon Capital LLC. Smith acted as an advisor to build models and option strategies to reduce portfolio exposure and enhance returns for the four main funds. Since 2015, he has worked for Adam Mesh Trading Group. There, he has managed Options360 and Earning 360, been co-leader of Option Academy, and contributed to The Option Specialist website.