Open Post to All 401k/Investment Market Participants
IF you are invested in US assets (or other global assets which have been killed), then this post is for you. Full disclosure, I am 100% cash regarding my US stocks and indices positions. I know many people on here do not understand charts or technicals, and quite frankly a lot of the fundamental issues you are listening to on the TV is all a crock of bologna anyways so I realize this can be quite confusing. I attempt to convey to readers in a way that is easy for EVERYONE to understand.
First thing you need to do is TURN OFF THE TV. The majority of TV is pushing an economic agenda and quite frankly is finding a reason for every price move.
Second thing you need to do is be on the right side of the trend. Are are going up, or down, or sideways. If we are going down or sideways then being in the market long term is a complete waste of time and you are losing money. So lets pull up the LONG TERM Chart of SPX
You can easily see that the trend has been up since the February lows of 2016, boosted by Brexit, Trump victory and then the riding “high” that the trump euphoria caused the market to undertake. That “high” is running low on fumes. You can see the Long term trend has been broken and the trend (200 day moving average red line) is starting to DECREASE. This is facts based on data and shows that the market is running out of steam and needs to correct with TIME or with PRICE. Best case is time and we go sideways like 2016, however if we were to correct through price then you are looking at a move down into the 2300 area in the S&P500.
Presently, we are at 2715. If you zoom in, 2808 is MY LINE IN THE SAND. Above that we are going to be long the market, below that we are going to be OUT.
Sure if you sell today you are losing 3.0% today, however isn’t this 3 percent worth it considering we have gone straight up since 2016 (a gain of 50+%) and you are risking giving back almost half of that gain if you ride this out? I think it is.
I am 100% cash and if you are over the age of 55+ you may not have time to recover from the coming months if we were to break lower. I will be staying 100% cash until 2808 is taking out on a closing basis. The selling is accelerating and I made a post yesterday regarding this level. Over 2808 we are targeting 3000+ and I will be long again, but it is not worth the risk here right now.
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