Persistent partisan politics persist posturing for positions in not only an effort to press prices, but to constantly stoke discord among the citizenry it seems. There should be speculation about the extent to which disruptions might impact the stock market (not merely the swearing-in ceremony of the new President).
But, the focus has mainly been on high market values (by measures that for the most part are conventional and not factoring in any transformation of the US economy, which if successful would suggest a couple years out that the price levels of the old-line stocks that rebounded might seem attractive even at the initial post-Election prices).
Plus fairly logically, the question of whether policies can be implemented in a quickly enough fashion to have a chance of forestalling a budget busting fiasco.
We have an Inauguration; which should be a joyous honor to attend and for the nation to applaud, regardless of the rancor that preceded. I have called for the market to remain in its relatively high range 'pending' Inauguration as you know. However I have suggested that it gets perhaps lots more dicey in the wake of the 'Event', and particularly so if you do have massive protests, in ways that go beyond respectful opposing views. I need not detail these as you all know what's at risk. You also know I'm looking for increased market vulnerability from the time of late-January and early-February.
Bottom-line
As this is a brief holiday weekend comment; there's no reason to expand upon the topics you already know; or our persistent bullish views about what a Trump victory would do for the markets (up not down much to the chagrin of bears like Soros). We also urged buying 'then' immediately at the same time as no more after the initial November/ December thrust. Now it's a question of holding positions; perhaps building cash (unless plenty still is available); because there should be a contraction in the weeks ahead.
Yes I know other technicians and analysts have fought the move all the way up; and yes we have not had a 'spike' parabolic blow-off. Odds are we get a move slightly above these highs (though it's not terribly pertinent). If we do, it actually enhances the downside prospects thereafter. If we do not, just from a technical viewpoint, it would suggest (even more emphatically) that a drop from daily-news hammering or what-have-you is just a pause within ongoing uptrends; but there's such great news and financial variables, that's tough.
It is reassuring that so many have tried to call tops over the last few weeks, with the NASDAQ (especially) and even the DJIA and S&P holding-up quite well through it all. It may be wait-and-see for the Dow; but for the broad big picture markets, it's been a pretty steady advance overall. Oil remains part of the key of course.
In sum, undulating markets 'were' my January forecast, and we have that; albeit in a relatively narrow range for the S&P; and strong for the Nasdaq.
The upside 'optics' have been clear since we visualized a 'Trump Romp' not only from the Election forward, but in the event he won envisioning a switch to a far more bullish stance than seen in years. Rightfully so as markets and corporate responses to the 'Bully Pulpit' of the President-elect have shown. With that said, it's been great to be bullish for the wonderful upside thrust of the last two months; and we're optimistic for the Nation, if things kick-in with a deliberate and not reactionary tone with regard to trade and immigration at the same time as deals are made (whether with Russia or others) tending to reinforce everyone's security, both financial and physical, in the free world. It can be an exciting time; and perhaps the coming Administration will be more likely a 'Teddy Roosevelt' era, than one reminiscent of 'Calvin Coolidge'.
We can say that the 'future' is not going to be traditional; it will clearly move in a direction I've long advocated when it comes to sensitive challenges: it's best to 'face the music before the music faces you'. Perhaps this mantra reflects Trump's bias for negotiations rather than confrontations after at first blush seeming to dictate to countries or companies. Again: 'Art of the Deal'.
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