Clearing the Thanksgiving hurdle, we will look to year-end. How will stocks end up this year? Given there is over 3 trillion parked in Money Market accounts while the Market is at all-time highs suggest there is more room to run. While we can only react to what is in front of us rather than what might happen our focus will remain on our stocks and the overall stock market price action. We must always be prepared for anything that may come our way and our risk management practice ensures we maximize our profit potential while minimizing downside risk. Remaining disciplined in our approach has led us to be successful for more than a decade. There is a reason Big Wave Trading longevity exits and knowing how to handle risk is top of the list. This market is likely continue to push higher. We will see and always focused on minimizing our downside risk.
The looming date out there is the 15th of December. Will a US and Chinese trade deal get done or at least avoid tariffs going into effect? Many investors are worried about such a catastrophe. This situation reminds us of what happened during the fiscal cliff. A deal was not going to get done and we were headed towards a “cliff.” Of course, a deal got done and stocks roared higher. We can debate the details of the rally, but stocks pushed higher. In the end, it is about where stocks go and not the reason why. We are not concerned with being smart at a cocktail party. Our accounts is where our reward is. Growing our accounts because we were on the right side of the trade and controlled our risk is where the reward sits. If you are worried about being “right” for others you are in for a rude awakening.
We certainly expect to see more headlines regarding tariffs and the trade deal. It will certainly be a mix. A solid sign for the market was IWM breaking through resistance. If we can see continued strength in small cap stocks a year-end rally will be a great way to end the year. There are gems all over the place if you are paying attention to strength. If we stick to our process, we will take advantage of whatever this market will give us.
We hope you enjoyed the Thanksgiving Holiday. Just one month left to close out 2019 and this decade. Keep focused and we wish you the best of luck.
