Posted At : June 11, 2009 9:48 AM
In the short term, we are overdue for a correction. Since June 2, the DJI is essentially unchanged (8740 to 8739 today), while the S&P 500 has lost just 4 points. But, over the same period, the % of Stocks Above their 10-DMA has dropped from 89.5% to 56.5% and Buying Power has fallen by 26 points (162 to 136). These signs of deteriorating breadth and contracting Demand suggest substantially more market weakness than implied by the nominal changes in the major price indexes. Therefore, investors should avoid becoming complacent.
A Tactical investment strategy, much like our TDT™ , is a must in this market, with buy and hold investors continuously getting punished. Our strategy of high dividend paying stocks and high yielding corporate bonds, both in the double digits should continue to do extremely well. I want to get paid while I wait and see. This is a dangerous market, so be the expert or hire one.
Regards – Keith Springer