As I wrote the other day regarding the dramatic reversal in the NASDAQ 100, this bull market is not going to die easily nor without a fight. Even pullbacks and corrections have been and will be tough to come by. As I have seen a few small short-term concerns pop up, I still believe the bulls are going to fight hard to prevent any significant price damage.
As I am keenly watching for signs of even a short-term peak, the major indices still have the look of wanting at least one more high above this week’s high. The indices just don’t appear to be complete in their upside right here. Banks, semis and transports have stepped up a little this week as discretionary is finally showing signs of tiring. That’s okay. High yield bonds have rallied, but they are far from leading and I continue to believe the final peak has been made for this cycle.
With stocks lulling people into a sense (false or not) of security, the geopolitical backdrop is as toxic and loud as ever with the President constantly tweeting, counter punches by the democrats and even some from his own party and stream of comments from global leaders. In the end, as I have said since inauguration day, successful investors will be the ones who separate rhetoric from reality. Reality is that the economy has accelerated higher, consumer confidence and sentiment are at or near all-time highs and unemployment is near historic lows. The reasons and credit do not matter.
