Bullish, Messy or Bearish?

JC Parets
December 8, 2021

No matter which markets you're investing in, this is a good lesson.

The visual below comes from this Yesterday's Crypto Note. It shows the different scenarios that almost all cyrpto currencies currently find themselves in.

Most are below their former highs, and stuck in a range once again. You can put US Small-caps in that exact same category too, for example.

Homebuilders and Semiconductors look like the one on the left. You can put $LUNA $MANA $SAND $CRO and even $ETH in that category.

And then you can find a lot of nasty Cryptos that look like the one on the right. You can probably put the ARK Funds, Biotechs and China in that bucket too:

If you're not getting our Daily Crypto note, contact Peter and talk to him about adding you to the list. It's a much have these days. You can also call in if you prefer: (323) 421-7991

But regardless of your preferred asset class, the principles above are really important.

I think you want to be buying the stocks that are above their first half highs. I think you want to be buying stocks showing relative strength. And I think you want to be buying stocks where momentum is not getting oversold.

Just because a crypto or a stock is in the Red category on the right, doesn't mean it's going lower. Quite the opposite actually, I think many of them can squeeze. Look at Airlines this week for example.

But do we want to be buying the worst stuff still stuck below overhead supply? Or do we want to be buying the stuff that they couldn't knock down when volatility spiked?

I think the latter is probably the better way to live.

Trend Following Life > Mean Reversion Life

 

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