Interesting day on Friday. The Dow Industrials were down -.28% while the S&P 500 was up .25% and the Nasdaq 100 up .92%. More stocks went down than went up the NYSE.

In the chart below you can see the S&P 500 in the upper panel with the NYSE Advance/Decline Line in the lower panel. See how the S&P has been making a series of new highs? Now look below that at the NYSE A/D. It has been going down this month which is a tiny warning sign. The two should be moving in tandem. It is telling us that participation is waning over the short-term.

If this wasn’t December, I would be more concerned. Still, markets are set up to pull back, but they absolutely do not need to before 2025. If we do see weakness, my thesis remains to buy.

Finally, stock market sentiment is starting (or continuing) to look more and more like late 2021. I don’t have to remind you what happened to the markets in 2022. However, the rest of the market is not mirroring 2021. So, let’s not start fretting about a 35% peak to trough bear market. I have my 2025 forecast for stocks pretty much solid and I will start to drip that out over the coming days and weeks. Many of you who have had update meetings with me this quarter already know my thoughts.

On Friday we bought VGK, QQQW and FXI. We sold EWS, PDBC and SPYB.

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