After a brief respite during December and January, the bull market has now reconfirmed its bullish trend. Buy signals are back in place and my recent moves to fully increase exposure in the portfolio model in advance of the recent breakout are performing well.This week I am going to review the current technical status of the market to provide a better understanding of the risk/reward that currently exists in the markets.
Importantly, just because I am discussing the resumption of the “bullish” trend in the market, it does NOT mean there is NO RISK of a meaningful and crippling mean reverting event in the near future.
You should remember that when you are investing there is NO SUCH THING as LONG TERM. All you have as an investor is the capital that you are speculating with today and the time you have until you need it. Investors have lost almost 6-years of their investment time horizon simply “getting back to even” following the last market decline. While the capital has been recovered, the time lost can never be. This is why so many retirees are now unprepared to retire which explains why the number of individuals over the age of 64 is at the highest level on record.
When you are told “you are a long term investor” and you should just “hold” investments for an indefinite period it suggests one of two things: 1) It is due to laziness; or 2) there is no real understanding of how to invest or control risk.
