Tom Scollon
Chief EditorYes I know you have heard it before; ‘all news is good news.’
For the moment it is. The DOW is climbing despite 15 consecutive interest rate hikes. Oil is on a rampage again – well maybe. But yet Father DOW is relaxed and cool – well, for the moment.
Resources are booming and with the falling Aussie – for the moment – our miners are able to show more profit on their bottom line.
This week’s columnists put forward some interesting propositions and provide some interesting views about where the market may be at this point – with a general hint the market may be near its top.
Certainly everything is good news at the moment, but we can all recall back in mid-February this year when all news for a period was bad news.
Market sentiment is all about perspective and the collective opinion of all participants in the market at any one time – whether they be small traders or large hedge funds. And in recent times hedge funds (who are the big movers of markets) have been buying back into resources.
One of the characteristics of hedge funds is that they do not fall in love forever. They have short flirtations, and very fickle ones at that. We also know that when they fall out of love they do it quickly and markets dive.
The trend of the market is still up and we stick with the trend. Well, that is a well worn saying. But another is ‘take the bulk of the move in the trend’. This means that you do not have to pick the exact bottom and the exact top. In fact, that is fraught with danger. Sometimes it is good to be satisfied with the profits you have made and do as JJ did – take time out!
Enjoy the ride
Tom Scollon
Chief Editor