A CONFESSION: I HEAR VOICES IN MY HEAD
At any single moment in the financial markets there are two voices in operation. The voices come along with anticipation and desire for what is to be expected from the markets in the coming days, weeks or years. One voice is constantly on the receiving end of betrayal and deception. The other speaks the truth. The two voices are that of your average market participant (hedge funds, professional investors included) and the voice of the market itself.
You can observe the two voices at work presently:
Voice of average market participant: The markets have gone up very quickly over the past couple of weeks. I thought we were going to move lower into the summer months before going higher. I don't think I can chase this market up here without losing money when the market pulls back in the next few weeks. Earnings season is approaching. There will be a lot of risk and volatility. Market has been so choppy. Volume hasn't been that great on the move up. I can't chase it up after such a large run over such a short time.
Voice of the market: I shook a lot of weak hands out with a standard pullback. I have retested the March lows and shot up so fast that most investors have been caught off guard. There are a lot of fund managers out there who are not allocated properly waiting for me to pullback. I may pullback a little, but it won't be much. I simply have too many people off balance here to give them a chance to get in at a favorable price. I'm going to FORCE them to chase me when I take out the highs of the year. Only then will I put together a pullback that matters.
Those are the voices I am hearing on this day. I know which one to listen to. Do you?
