Profit taking hit the stock market as traders opted to react negatively to a story posted today by a major news agency that quoted “anonymous sources” as saying that the President was going to do something next week about tariffs towards China. Really? “Thanks for the heads-up Mr. Media.”
As a result of the so-called news, the market tanked quickly (yet briefly) as traders hit the sell button to take profits. As the day wore on, and as seasoned investors contemplated the lack of depth in what the news outlet had shared, it became obvious that no panic was developing. Damage was done, however, as the markets logged a new day of professional selling (aka: Distribution) and ended solidly in the red.
For skilled investors, paying attention to the hot (or fake) news of the day is not an option. Rather than relying on sound bites, tweets and agenda driven website articles, the pros focus on the price and volume action of the major market indexes and the leading stocks of the day. At this point, those trends are still bullish.
While there are mounting issues on the horizon that pose a potential threat to the uptrend, there is time for them to possibly be remedied before they cause any serious damage. (South America is one current eroding example.) While our official outlook remains in a green light, we are closely monitoring two internal technical indicators that are beginning to show a hint of growing weakness. We will respond accordingly in our strategies if those 2 (along with other indicators) flash any “caution” or actual “sell” signals in the near future. In the meantime, have a Triumphant day! ®