Our Current Market Outlook remains “Market in a Confirmed Uptrend”. Welcome DOW 26,000! With one of the best starts to a new year ever, major US stock market indexes continue to hit all-time highs. To some investors it has been breathtaking. To others observers it has been a source of frustration and confusion. To us it has been business as usual and a fulfillment of what we were expecting after the Aug-Sept 2017 weak period in the stock market broke-out to the upside on a delay of the debt-ceiling showdown, and then the November decision by Congress to submit a tax cut bill to the President by Christmas propelled it even more.
However, there is an immediate risk facing the markets with Fridays pending Congressional vote to raise our governments debt-ceiling limit. The deadline is midnight tomorrow and the markets reaction will likely come on Monday, unless there is an earlier announcement. It is very interesting to note that as this issue is coming to a head, one of our key internal indicators is on the verge of signaling a first-stage “sell” signal. Mathematically that signal could come as early as tomorrow. If it does come, keep in mind that it is not a sell everything type of signal. Our risk management discipline involves a process of three separate sell signal stages. The first signal puts us on alert that underlying conditions are changing and that we must begin focusing more on the internal indicators that may lead to a second-stage signal. In the meantime, continue to enjoy this American renascence and stay tuned to this page for updates. Have a Triumphant day! ®