I’ve been expecting a good start to the New Year, but the 6% move in the last 4 days is a bit too much too fast. The news overall is still very negative and the earnings picture has not improved at all. While I have been very bullish heading into the New Year I feel obligated to pare back risk at this point. The last year has seen many textbook bear market rallies and this one looks very similar. Light volume, no news, big % move. Not the way you want the year to start. I wouldn’t be shocked to see some follow-thru in the coming days, but I am not chasing this move.
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.