While the DOW remains comfortably above this line, both the S&P and NASDAQ are closer to breaking it to the downside. Coming off the December 2018 bottom, a new, steeper short-term uptrend line began which also remains in place as of today. When the markets bottomed in December 2018, the slope of the previous uptrend line which began in 2016 was lowered, and to date remains in place for all three averages. Going back about three years the uptrend that was in place for all three market averages was broken in the last quarter of 2018. By the way, I do not, nor ever have shorted a stock - I don't like the prospect of unlimited risk of capital. I am very comfortable if I miss five or ten percent of a market move so long as I feel comfortable that an uptrend is in place. ![]() That said, I do not try to time the markets, I do not attempt to buy absolute bottoms or sell absolute tops. I want to assure myself that to the extent possible, if I make a purchase that I am making the correct decision. I do however watch the market averages closely in an attempt to determine if markets are overbought or oversold, if long-term trend lines are being violated, or if we are entering (or exiting) a correction. My analyses focuses on individual stock evaluation when a stock meets my criteria for inclusion in the Protected Principal Retirement Portfolio (PPRP), I follow it on a daily basis. The answer to this question is: no matter what the market "gurus" say - no one knows! With a week left in the month these figures are subject to change. In 2019, from September 1 to date (September 24 as I write this article) the DOW is up 1.7 percent, the S&P is up 2.0 percent, and the NASDAQ is up 1.2 percent. However, over the past few decades the September Effect has become less of a factor. Since 1950, the average September decline for the DOW has been about 0.8 percent, for the S&P about 0.5 percent, and for the NASDAQ about 0.5 percent. For those of you whom are not familiar with the September Effect is typically a drop-off in the Dow, S&P and NASDAQ averages. With September almost in the rear view mirror I briefly took a look at the stock market's performance (month to date) to see how the "September Effect" has played out for 2019.
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