At this point, with the steam the market has built up I think it’s going to take one of two things to occur before we see this mythic market correction that everybody has been expecting for what seems to be forever. The market is at a tricky juncture, being extremely overbought and refusing to drop. Hitting the beach is always an option.
- Some significant bearish catalyst. Could be a bellwether coming in with extremely weak earnings. Maybe a terrible government report or more likely additional government interventions in the markets. Natural disaster perhaps…. Yes I’m stretching there, but my point here is that until the markets character is tainted, the up move is likely to continue.
- Blow-off top, culminating in a huge move up sucking in every last baby bull that has been on the sidelines that can’t take it anymore.
Be on the looking out for either of these scenarios to play out before thinking about shorting.
