Wednesday, 8:53 am EST. What can we say about Tuesday? That was quite a move, wasn’t it? I think I am able to say now, rather definitively, that the OEXpert 7 called it yet again. It had not done so since it was pointing right at the week of the national elections, the first week of November… so, it’s been awhile. My XP laptop had died, and I had no opportunity to update it. That was some time back in late March. A friend had an old Compaq XP laptop machine, and he got the Xpert on it, with data that needed to be updated from the date my machine had died. We were able to do that while attending a monthly investors/traders meeting for a Boston area group on Thursday evening, April 13.
I updated the data file while sitting in that meeting, and when I was finished, I read the indicators, and realized that they were just beginning to point to an immanent point of turning by the middle of the next week, or, by my estimation, Wednesday the 19th. I even stood up right at the end of our meeting, laptop on my arm, and told the entire group of this. That might seem like going out on a limb, but the Xpert’s never been wrong, that I can recall, in the 25 years I’ve used it.
It is worth pointing out that the actual turn did commence with Wednesday the 19th, and even though I was somewhat reticent about the call, by that date, the Xpert was signaling it, but not as convincingly as I would have preferred. Because I was going to be away Tuesday the 18th, and Wednesday the 19th, I was a buyer of some shares Tuesday morning, and again, after we had returned home, on Thursday morning, the 20th. Needless to say, those are looking like they were prescient purchases, that I’ve no need to regret at this time.
So, now we are at new highs. There’s all kinds of news coming, on the earnings front, and from out of DC, with respect to taxes and healthcare insurance. There may be many positives to justify this upward move, and could also give impetus to a whole ‘nother rally effort to take this market to valuation heights not seen in many years, and by some measures… never before!
Here’s the conclusion… It is the “Risk-On” trade right now, and market valuations are getting stretched to all of their upper limits. However, policy changes from DC could almost justify such a thing, if the net result of their implementation is a whole new catalyst to some real economic growth and energy, not seen here in a very long time. The market is a forward-looking discounting mechanism, that tries to foresee the future by some 12 months out… and, right now, if the Trump agenda advances on all fronts, the end-result will likely be a whole new surge in economic activity and growth, the likes of which could rival Reagan and the 80’s! Are you willing to ‘bet’ on that? If so, it’s Risk-On, in anticipation of it!