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The Triumphant Core Four

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Investor Sentiment

Special Bulletin: February 16, 2024 (10a Update)


 A Shot Across the Bow?

Froth. Euphoria. Complacency. Three words that every investor/trader needs to be able to identify. Or, ignore them at your own portfolio’s peril. 

Ravenous bullishness is not a reason to “sell all and head for the hills.” It is true that excessive bullishness can last for weeks, even months, before finally yielding to a sharp correction. It isn’t the same every time, so investors must study the market and think for themselves. (Praying helps, too.)

Tuesday’s sharp sell-off (a distribution day) was possibly a warning, a “shot across the bow,” for alert market participants. What happens in the next few days will bring immediate clarity/confirmation of the institution’s intentions. An immediate push to new highs on big volume would be comforting for the bulls. A series of distribution days that pierce through key moving averages would mobilize the bears. Ask yourself what “camp” you live in. What is your outlook, and better your true nature, saying to you at this moment? There is no greater potential enemy to an investor than one’s own self. One of God’s Ten Commandments, “thou shall not lie” (to anyone, but especially to one’s own self) is essential for flourishing in every aspect of life, including investing.

This morning the inflation data came out hot again. If it continues like this as we draw near to the election, maybe it will be blamed for global warming too. (For the record: The sun heats the planet.) The “climate” is changing. A populous up-surge is unfolding again, and it appears greater than even what happened in 2016. And rightfully so as many true patriots are really disgusted. Due to that, the stock market is vulnerable to short-term acts of manipulation intended to influence the masses (read, voters) and cause fear which can lead to a knee-jerk dependency on Washington. 

On a risk management level, there are two opposite forces working at odds with one another: Inflation that just won’t go away and a belief by giddy investors that multiple rate cuts are coming… and soon. Let’s see if today becomes a second “shot across the bow,” or maybe worse- a torpedo, directed at the market. Rates have risen and are up around 4.30% on the 10-year US Treasury note again. That level is manageable but needs to be closely monitored. 

Our Current Market Outlook remains “Uptrend Under Pressure” with a yellow light (SPX 5,005.67). Our “Core Four” (see top of page) still shows 2 green, 1 yellow and 1 red light BUT with a VIX that is now over its 50-day mav. FYI: The advance/decline lines remain unimpressive but a bit better. The number of daily new 52-week lows on the NYSE is tame.

Keep an eye on the precious metals too. Silver recently established a higher low and is forming what can possibly be viewed as a bottoming pattern. If all heck breaks loose like some are fearing/forecasting (Carter-Volker: late 70’s), then the precious metals may be able to be seen as a harbinger of trouble.

Remember that the trend remains up while the major indexes are trading above their 21-day mav’s. That was tested on Tuesday, and it has held – so far. 

“Woe to those who go down to Egypt for help and rely on horses, and trust in chariots because they are many and in horsemen because they are very strong, but they do not look to the Holy One of Israel, nor seek the Lord!  Isaiah 31:1 NASB 1995  

Game plan: Bulls: Make your stand now. Bears: Bring it on! Maybe those 2 camps will just offset and cancel each other out? A sideways chop is possible, but it won’t last forever. Pray, and wait for the Lord through the math of the market to help you discern the right side. The trendlines are properly stacked and the major indexes remain over their 21-day mav’s. Please pray for Israel and peace for Jerusalem.

Note: You can learn more about The Triumphant Core Four risk management system by clicking here.

Have a Triumphant day! ® 

The information in this article is based on data obtained from recognized services and sources and is believed to be reliable. Any opinions, projections or recommendations in this report are subject to change without notice and are not intended as individual investment advice. Not to be used as legal or tax advice. ©2024 Triumphant Portfolio Management, LLC.

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