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Down Trend Decision Point

Down Trend Decision Point

October 28, 2022

Key Takeaway

The recent breakup in the market, which we've played, is at a turning point. For the very near-term, the market will either turn up or down. As you will see, the S&P 500 is right in the middle of its down- trending channel. Therefore we are keeping our trades VERY tight. There is a time and place for a buy and hold strategy; however in our opinion, now is not that time. We feel that more active trading is the best way to help navigate these very rough waters.

We are now in the thick of earnings season, and individual stock market performance is very dependent on its previous quarter's performance and more importantly their future outlook. We've seen some major players like Google, Microsoft and Amazon miss the mark, and their stocks are getting punished for it. Apple on the other hand reported somewhat decent numbers; however, their iPhone sales have dropped off a little, so the verdict is out on if it can find its footing here or not. These four stocks alone make up nearly 19% of the S&P 500 and nearly 37% of the Nasdaq. Therefore their performance has a large impact the major stock market indices.

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