I haven’t had a chance to catch the news or read anything on the markets today. But, it doesn’t matter. Whether it’s about earnings, China, May, or QE, no one person can predict for certainty what will happen in the markets anyway, not even the people who think they know. So, it is important to remain objective, not subjective, on our views of the market. All you can do is look at the data. U.S. Dollar below:
Notice how UUP (U.S. dollar) is trading between two significant moving averages. UUP is on the verge of a strong move, one way or another, next week. Traditionally, stocks and the dollar have an inverse relationship. Here is a chart of the S&P 500 below:
Without trying to make things complicated, the trend of the market is up. I agree, things are starting to look shaky as we flirt with the 50 day moving average. Stocks could easily go lower in the coming months as more and more people start to believe the correction is due. But don’t stray from the plan until something actually changes, not while the S&P 500 is still on the fence.