Thoughts {01.11.19}

Markets are opening in the red for today.  Probably to be expected since we've been up five days in a row.  Of course a lot can happen between now and the end of the day.  The action so far in 2019 is the exact opposite of last December.  Then stocks opened higher and traded lower as sellers came in during the afternoons.  The last two days we've seen attempts to sell early in the day then the buyers come in so we'll see how the day closes. 

We are seven trading days into the new year and stocks have been trading very well.  Seven trading sessions don't make a year but if we could magically annualize the calendar forward then stocks would be annualizing about a 42% gain for the year!  That is unlikely to occur but the action is more positive so far in January.  

Stocks are up better than 10% from their lows on Christmas Eve.

And if we could roll the calendar back so that yesterday's close was the 12.31.18 final print then the major US indices would have traded flattish for 2018.  Shows you the incredible volatility we've seen in stocks.  Also shows you that investor returns are best judged over longer periods of time.

My guess is stocks are trading about where they should've closed at the end of 2018 if all the algorithmic nonsense and end of the year redemptions hadn't come in selling markets when there were no natural buyers around to absorb the supply.

Back early next week.