After reccing your post, I'm going to pick it apart:
1. Yes, there will be uncertainty the rest of this year. But the same could be said of anytime in the last 3 years, or 10 years. Uncertainty will produce volatility, and dips in a bull market, but doesn't necessarily mean the bull is dead.
2. <This cycle is long in the tooth> Yes. But are we in 2006 or 2007? 2000 or 1999?
3. Outperformance of defensive sectors, and SOX lagging, is a sign we are past the mid-point in the up-cycle. But the Late Bull phase can continue for an indefinite time.
4. The pattern of the stock market hitting new highs, while fewer stocks hit new highs, is another pattern that can continue for a long time.
5. A surge in new highs happens after the market bottoms. It also happens during every rally in a bear market. A sensitive, but not specific, indicator. Not useful, imo.
6. No new highs (sometimes for extended periods) happens at market bottoms, but also at bear market dips long before the final bottom (like early 2008). They also happen during dips in a bull market (like in 2010, and again in 2011). Again, this indicator is non-specific.
disclosure: I'm using this dip to cover short positions, and very cautiously add long positions in quality, dividend-paying companies. Today, I started a position in SI (Siemens, the European GE). I started a position in AMAT at $10 on 6/4, and will double up if AMAT returns to $10, which looks like strong support. |
