This market is insane!

[BlueWolf]

I haven’t seen anything like this during my time of actively managing my investments. It sure is a good time to be fully invested. I’m a little over 7% in cash with the rest in equities although I’m getting tempted to start throwing a little into crypto. The thing is, though, with this kind of a frenzy, there is going to come a time (soon?) when investors decide to take some profit. I think that’s going to cause a hard correction so be prepared. We’ll see.

[BlueWolf]

Well there was a little profit taking, triggered by the Fed’s announcements regarding rates I believe, but it was only good for about a 3-4% retrace before the buyers came back in. Earnings, for the most part, are still coming in strong, and I believe this is helping to fuel the fire. What worries me is the likelihood that the next major correction, e.g. see July of this year, will trigger a tsunami of profit taking causing a very steep and rapid decline. When things happen that fast, it’s difficult to be ready for it. That’s me the worrier, though. Since we just made new highs, the momentum should be in our favor for now in this deliciously bullish market.

[jiesen]

It's not so complicated to be ready for the big drop, just hard to take if it's a mistake. I really think we are in for one, though, so I've sold off a big chunk of my holdings right around the 6000 mark for the S&P. I expect to buy it all back around 5500 or lower, depending how fast and hard things fall. But mark my words, fall they will! It's just that you never know when that's going to be.... could be a while before it happens, but I'll be ready to buy back in when it does! Now, if we just keep marching on up to 7000 or 8000 S&P and I never get back in, that's gonna be tough to swallow... kinda like all that NVDA, SMCI and crypto that I never bought 2 years ago. At least in that case, all the $$MM stocks I'm holding will continue to rack in the gains like they've been doing this year! Plus, the cash now makes 4-5% in a money market account while I wait... so there's that.

[BlueWolf]

It's not so complicated to be ready for the big drop, just hard to take if it's a mistake.

You’re right, of course, and that’s what I meant about getting it right. It’s trying to strike that balance between not leaving money on the table and not giving back too much profit. You’re never going to hit it exactly right, but you don’t want to get caught in a major correction like we had in 2022 especially after gains like we had in 2020 and 2021.

[Louetta]

I've been trying to hedge my bets by moving into financials and mid-caps to balance the high-tech stuff, hoping profits taken in tech will go elsewhere and there will be no general sell-off. For financials I have fncl, iyf and xlf (lot of redundancy) and for mid caps fdegx and fgsix.

Happy Thanksgiving all!

[BlueWolf]

There is a Head and Shoulders pattern on all three major indices. It’s a little worrisome. I’ve been closing a lot of my positions over the last two weeks just out of caution. Of course, the neckline must be broken for it to turn bearish, but it’s worth keeping an eye on.

[mrmarket]

There is a Head and Shoulders pattern on all three major indices. It’s a little worrisome. I’ve been closing a lot of my positions over the last two weeks just out of caution. Of course, the neckline must be broken for it to turn bearish, but it’s worth keeping an eye on.

Vix is up to 20!

[BlueWolf]

I’m currently sitting at 25% cash. A couple of weeks ago I was at 100%. The valuations of many of my stocks has reached nosebleed levels, which is OK only as long as the companies stay in growth mode. Any signs stagnation will result in severe sell offs, and that’s what I’m on the lookout for. The H&S patterns on the indices got muddied over the last two days, and seem less of a threat now. To be honest, I’m not sure what to make of it at this point. I’m just going to be very diligent.

[mrmarket]

I’m currently sitting at 25% cash. A couple of weeks ago I was at 100%. The valuations of many of my stocks has reached nosebleed levels, which is OK only as long as the companies stay in growth mode. Any signs stagnation will result in severe sell offs, and that’s what I’m on the lookout for. The H&S patterns on the indices got muddied over the last two days, and seem less of a threat now. To be honest, I’m not sure what to make of it at this point. I’m just going to be very diligent.

A lot to be concerned about...the tariff policies being thrown around - and possible repercussions....are not at all good for the market. Also, if we deport millions of immigrants, who is going to rebuild California?

[BlueWolf]

The futures are getting slaughtered right now (Sunday, Feb 2). Expect a HUGE down day tomorrow. Wish I’d booked profits on Friday, but I didn’t. Getting out tomorrow will be tricky, but I might have to pull the trigger anyway if things look like they’re going to avalanche. God, I hate trading into a gap down.

I tend to hold more than a few aggressive positions, i.e. stocks with exceptional growth but high valuations. Unfortunately, those kinds of stocks are usually the first to get crushed in a correction. The only silver lining here is that there will be a lot of great entries available on premium stocks after the dust settles, and I am currently still 20% in cash. To think I was at 30%+ just a couple of weeks ago before I started accumulating again.

Ugh. I dread tomorrow.

[BlueWolf]

Wow, that wasn’t nearly as bad as I thought. When I checked the futures yesterday, the Dow futures were down 500 and the Nasdaq futures were down almost 700! I guess cooler heads prevailed.