The end of the year upswing seems to be showing signs of resistance. The indexes are looking skyward, to be sure, but the closing numbers don’t seem to be reflecting the sentiments of the daily activity.
We are enjoying some nice gains as our well-timed “buy signal” has proven the Fabian Plan is doing its job, as usual. We are looking at a good solid market with some stellar fundamentals that may very well carry us through the holiday season.
We are, however, vigilant, as we are extremely aware of the underlying trouble areas plaguing the overall economy. We are basking in a short-term upswing, but we are at the ready for the other shoe to drop in the markets as the average investor becomes acutely aware of the fundamental problems we see looming on the horizon.
Warning shots from Alan Greenspan, a weak housing sector, higher interest rates, budget deficits, trade imbalances, soaring medical expenses on an aging population all come together to create an economy that is riddled with the potential for a bear market that can rise and roar in a heartbeat.
The market looks good for now and I am riding the crest of the wave with a 100% investment in the sectors that are poised to rise higher than all others. Am I committed to this market? Yes, for now. As soon as it turns, I’m on the sidelines to protect my gains. That’s how the big gains are made—and kept.