This is Why You Listen to the Market

Today was a monster rally, that is good. It would be fair to characterize my thoughts about US markets over the last few weeks as a skeptical participant. The market shouldn't be going up but it is. One trap that managers fall into is letting their knowledge get in the way of seeing what is going on. The market has shown there is a demand for equities right now. Maybe we can figure out why there is demand or maybe not but there is demand nonetheless and that is the most important thing.

I wrote earlier about being ready to get defensive if/when the market environment dictates a defensive posture. That hasn't changed. I am still worried about the dollar, the economy and so on. My catalyst to get defensive in client portfolios is if the S+P 500 goes below its 200 DMA, I write about that all the time. I do not think it makes sense to try to outsmart the market right now. I believe that most of the people that attempt to do that will end up chasing the market.