Structural vs Tactical

A lot of new highs. Like A LOT of them...

Stocks, Sectors, Industries, Countries, anything with stocks as the numerator. New highs, All-time highs in most cases.

These are not characteristics of long-term downtrends, that's for damn sure.

And in some cases like U.S. Financials and European Stock Indexes, these are breakouts from massive bases.

So to be clear, we've been talking about a messy U.S. Stock Market. And it has been the past few months. And it will most likely continue, from what I can tell.

But this is all tactical. This is all within the context of a much bigger bull market.

Are fewer and fewer stocks making new highs the past couple of months? Yes.

Have defensive assets like Bonds, Yen and Gold stopped going down? Yes.

Are High beta stocks, Nasdaq stocks, and Small-caps all underperforming and not confirming the new highs in some large-cap indexes? Yes.

Should we expect this chop to continue? My argument is Yes.

But that doesn't change the structural trend for stocks, which is up.

If you're in the gloom & doom camp that we are in the early stages of an epic stock market sell-off, I encourage you to go through all the stock market indexes around the world. Look at those long-term bases in the International Indexes resolving higher. You'll smile. Watch.

Secular vs Cyclical

Structural vs Tactical

Know your time horizon.

Longer-term suggests one thing. Short-term points to something else.

That's how I see it.

You?

What do you got? Send it over!