SPX: What if the trend is still intact in the long term?
Updated
I've been considering this possibility, given the still active quarterly and yearly trend signals in #SPX500 here. You can see that both trends predict rising prices until the end of 2021, or even until Q3 2022. So far, seems like most people have been constantly trying to call tops since the COVID lows, and failing miserably at it. I've had my doubts, but now that vaccines are being rolled out very soon, I believe we might see further upside in equities, specially in the right sectors (which I'm invested in).
Some names might start faring worse if we see increasing inflation, but we have to keep an eye on the yield curve to tell if this is the case or not. For now, it isn't farfetched to assume a rotation to value might take place, but it is not crazy either to assume the index will trend higher for a long time still.
Personally, given the yield of stocks compared to treasuries I think it is reasonable to be long stocks, long term, as long as rates don't rise too fast. A lot of the usual suspects started banging their hyperinflation/death of the dollar drum again, I find it hard to believe they get it right.
I trust in our collective determination and wits, to take us out of this hole we are in since Feb, hopefully I'm not wrong for our sake.
Cheers,
Ivan Labrie.
Some names might start faring worse if we see increasing inflation, but we have to keep an eye on the yield curve to tell if this is the case or not. For now, it isn't farfetched to assume a rotation to value might take place, but it is not crazy either to assume the index will trend higher for a long time still.
Personally, given the yield of stocks compared to treasuries I think it is reasonable to be long stocks, long term, as long as rates don't rise too fast. A lot of the usual suspects started banging their hyperinflation/death of the dollar drum again, I find it hard to believe they get it right.
I trust in our collective determination and wits, to take us out of this hole we are in since Feb, hopefully I'm not wrong for our sake.
Cheers,
Ivan Labrie.
Note
I'm hedged here for now. Watching to exit hedge, but it looks like we might get an amazing dip buying entry near 3508.
Note
Trend is up, buy dips, buy VIX spikes, hodl solid stocks.
Trade closed manually
Market could have topped today: Trade closed: target reached
Target hit, I have gone to cash for now, given the weakness in index charts and general uncertainty. I still want to keep an eye on things, the daily trend is now down but could reverse, the quarterly signal here has time to rally for longer, if short term charts become bullish again. AAII sentiment came down below 25% after topping at 55% before, but it could drop further if the market is still falling (has fallen down to 15% at times)Trade closed: target reached
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