Capping off the last trading day of the Month Friday saw stocks pushing higher. We are living in a crazy world and the market will adjust to the shift. June is set to kick-off on the lower side but given the gains last week today’s indication of a lower open is not a surprise. We will continue to stay vigilant and with a solid risk management strategy will curb any significant damage to our portfolio. Given all the Federal Reserve liquidity in the market there is no question we are sitting where we are at with the Market. Free liquidity is going to lift stocks. How sustainable this rally is a debatable topic and one that is left to market pundits. No one has a crystal ball to predict the future. Run away from those who tell you they know where the market is headed next. They do not know. We only know the information in front of us and right now we are in a confirmed rally. Everything else is noise.
Execution of our strategy is always a point of emphasis. We cannot predict the future and we control our action, nothing else. Big Cap technology stocks continue to be the “go to” for fund managers. Flight to safety is big for large money managers. Self-preservation is always a big theme among money managers as they do NOT want to lose their jobs. This is precisely why we see a concentration in these names. AMZN and NFLX since the beginning of the rally in April have led this market higher. AMD is still building out a handle and poised to breakout. Will it work? Will it last? We do not know, but with any new signal no one knows if it will work. Through position sizing and exits we can control our risk while not losing out an opportunity to add to our portfolio.
Another week comes another opportunity to add to our portfolio. Do not sit idle and not do your due diligence. The grind is not for the faint of heart. Do the work and you will be rewarded with the proper risk management. Execute with precision and discipline.
