It is useful to periodically look at the technical condition of our stock market. As regular readers of this blog know, in the past quarter, the Bull warned that the stock market internals were pointing to a period of heightened volatility. Indeed, that is exactly what has happened, and the market tells us that this is likely to continue.
Money flows have been deteriorating and are now negative. The declining issues are greater than stocks that are advancing. Many high-growth names are now undergoing corrections. Their previous parabolic moves are being clipped. There was always the likelihood that profit-taking would emerge at some point. By waiting until after the first of the year, investors put off any tax due until April 2026.
The Bull and his partners are well prepared for heightened volatility. However, we do not expect a serious setback. After all, the economy is still growing, earnings are expected to increase, and the new presidential administration is expected to be more business-friendly. Stay steady my friends, and happy hunting for opportunity!
– The Lonely Bull