Market Update – 10/25/2018

My mom taught me that when you are wrong – admit it, learn from the mistake, and move forward positively.

Well, I was wrong in my assessment of the recent market pullback. My analysis indicated that we were in a garden variety pullback within an overall bull market.  I fully expected another decline to the area of 2,710 on the S&P 500, which was the low point from earlier this month.  However, yesterday’s (10/24) decline fell well below that level.  Essentially, the bears (sellers) overwhelmed the bulls (buyers).  The battle for control of the market is now leaning towards to bears.

As the market is extremely oversold, I do expect a bounce-back rally.  However, I am no longer as confident that rally will hold.  Time will tell.

In the meantime, I will be adjusting your portfolio to be a bit more defensive until I get more confident about the market’s direction.

On a long-term basis, I still believe we remain in a positive position based on economic conditions and financial fundamentals.  I still see no signs of an economic recession or major market correction (defined as a 20% decline from previous high) over the next 12 – 18 months.

As always, feel free to call with any questions or concerns.

Jim

 

Although information herein has been obtained from sources deemed reliable, its accuracy and completeness are not asserted. All opinions and estimates included in this report constitute the judgment of the financial advisor as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security.

Investing involves risk and you may incur a profit or a loss. Diversification does not ensure a profit or ensure against a loss. There is no assurance that any investment strategy will be successful.  Past performance is no assurance of future results.

Please consider the charges, risks, expenses and investment objectives carefully before investing. Please see a prospectus containing this and other information. Read it carefully before you invest or send money.

Information provided should not be construed as legal or tax advice.  You should discuss any tax or legal matter with the appropriate professional.

 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s