Will the Market Continue Up From Record Highs?

Stocks remain strong as both the Nasdaq and S&P 500 post fresh new record closing highs. Bloomberg analyst noted that it took 14 weeks for the stock market to fall and 17 weeks to recover. As long as you didn’t blowout of your positions, most investors are now made whole and perhaps even up a bit. The question is, can the market keep pushing higher? I think we can nearby, but at the same time, I’m trimming a few more stocks that are posting new all-time highs.

Stocks remain strong as both the Nasdaq and S&P 500 post fresh new record closing highs. Bloomberg analyst noted that it took 14 weeks for the stock market to fall and 17 weeks to recover. As long as you didn’t blowout of your positions, most investors are now made whole and perhaps even up a bit. The question is, can the market keep pushing higher?

I think we can nearby, but at the same time, I’m trimming a few more stocks that are posting new all-time highs. I’ve learned through the years, there’s a significant difference in my own “psychology” when I sell as the market is moving higher vs. selling when the market is moving lower. It’s hard to explain on paper, but it’s certainly different, and can greatly impact and influence my next several moves. I urge those readers who have to sell grains, energy or other commodities for a living to reflect back and think about the psychological impact of such a simple thing. On the surface you wouldn’t think it matters much, but it does!

Bulls argue that with the Fed on pause until inflation pushes back north of 2.5% or the stock market explodes even higher, it is giving them a huge window of opportunity to squeeze the bears and get more distance between themselves and the money-managers who are caught “under-invested”.

I’m also hearing bulls say, with the Fed on pause, stock valuations are actually fairly cheap. A valuation and trading formula that takes interest rates into account — the S&P 500’s earnings yield less the 10-year Treasury inflation-protected security’s yield — is cheaper than it’s been in the past and certainly shows stocks being cheaper in relation to where they were during the previous highs in January and September of 2018. Hence, there’s the argument that we could continue to melt-up higher, just like Larry Fink, CEO of Blackrock, the world largest money manger suggested last week, “the stock market is more at ‘risk of a melt-up, not a meltdown’. Michael Carr offered up an interesting perspective on Fink’s comments on a financial blog at Banyan Hill, I encourage you to read it in full by Clicking HERE

If you are looking to challenge your thoughts and perspectives as well as draw on Kevin’s 25 years of market and business experience, click HERE for a free — no obligation — trial of the Van Trump Report

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