Masses Still On Wrong Side – Milestone Coming Up

It hasn’t really felt like the rally has paused over the past few days. But it has in the S&P 500, Dow Industrials, S&P 400 and Russell 2000. Only the NASDAQ 100 has powered ahead. The stock market is back to being led by a handful of high profile tech stocks. My friend, Tiny, and I sometimes kid about the strength of a trend. In this case, we would ask each other, “will the market ever go down again?” Of course it will. Last April I remember asking, “will stocks ever go up again”. When markets get to the point where we kid about the trend, that trend often pauses.

The S&P is below and pre-market has another up opening with the NASDAQ 100 super strong on the heels of positive geopolitical news and strong tech earnings, especially Intel which we have owned since the middle of last year when it became the epitome of an unloved gem, the very name of the strategy we own it in.

The aforementioned NASDAQ 100 is below. Yesterday’s action led me to conclude a pause was coming today. Pre-market shows a rally above yesterday’s high to fresh, all-time highs. This three-week melt up tells me that the masses got stuck on the wrong side and are still chasing. Some of our aggressive models would be included in being on the wrong side and chasing. Our intermediate-term models remain negative, but position exposure did not get reduced much because price has been so strong.

Gold stocks are setting up, once again, for a potential rally. The last time I wrote about was in mid-march and that worked out okay. When our models set up for a trade, I don’t question it. I just execute. If it works out, great. If not, we will get stopped out and live to fight another day.

I walked down the path to the office with my head buried in my phone. I thought I went to the wrong office. Nope. That was the best office manager ever sneaking back to the office late last night to surprise me. I have another day before I hit 60, but I will be on a plane heading to Tampa for a conference that I am chairing as well as speaking at.

As I mentioned, I am heading to Tampa tomorrow for the annual NAAIM Uncommon Knowledge conference that I am chairing. I look forward to this every year, but it won’t be the same as one of my mentors, Peter Mauthe, passed away this week. He was only 70 and it breaks my heart. One of the most generous people I have ever met. One of the truly good guys in the world. A guy you could call at 3am to ask for help and he would pack his bags to come to you. Peter is below with my dad about 20 years ago.

On Wednesday we bought PCY and SPYQ. We sold EMB, RYTNX and some FDN. On Thursday we bought RYVNX and RYTNX. We sold RYRSX and some RMQHX.