Thoughts {02.12.18}

Well we've had an eventful two weeks in the markets haven't we?  I'm going to spend some time in the next few posts to try and give you some thoughts on where we might go from here.  Here's a brief:

Markets finally found a level where they were unwilling to climb further.  The combination of very over bought conditions, rising interest rates and rising inflation provided the concrete barrier that stocks slammed into starting at the end of January.  Once the bubble was popped investors ran for the hills.  The old Wall Street saying "stocks take an escalator higher and an elevator down" has been in play this month. 

So far today markets look to be stabilizing.  That is markets look to be trying to find a level of support from which to form some sort of rally.  The reaction to this rally that will be the most important thing to watch I think.  Stocks that make lower lows in the next few weeks could be showing a worrisome sign.  Same if stocks turn tail here and head lower.  On the other hand stocks that form a "V" bottom in here-that is a market that turns on a dime and powers to new highs could be signaling a stronger economy than most are currently expecting.

Wouldn't be surprised if stocks have made a high in January that holds until sometime in the fall.  Not a prediction, just stating a thought.

We may be seeing a sea change in how stocks are going to trade in the next few years.  

For all the bluster stocks are trading about a percent lower for 2018.  We're only in week seven.  Plenty of time for more positive results later on.

Back in the next few days.