So the Fed made good on my prediction and continued to be supportive of equities. Too supportive, 🙂 my hedge / option ran away from my breakeven point. I was looking at it yesterday and though my own thoughts is that the “rally” is exaggerated. We were looking at valuations being on the high side just a few days ago so in my projection the price went too far too soon, considering we are at the end of the quarter. And so far today, I have been proven correct with the BHP stock moving down 40+, as much as half of yesterday. I think it will hover around or drift lower a little bit at the current price till we get the proof of earnings new quarter. But one must think, if exiting, where should we put our money? “There remain very few alternatives for your cash other than putting it in stock” is a big idea from the article here.
Anyone for more predictions from me? Well,,,, I would bravely stay in stocks. Meaning, this bull market may be volatile but the uptrend should continue for a month or so! Again stick to those with fair valuations (PE below 16) if you can, just so you won”t get a thumping when a selloff comes around. Or if you are a believer in this bull market, go for the stocks that have been riding the bull market well or the so-called “momentum stocks”. Just remember your Risk management should be in place.
