Year-to-Date Strategy Stats as of COB today:
+ 36.44% : Turner Quant Advantage (TQA)
+ 12.70% : Tactical Growth (TG)
+ 1.63% : Diversified Income (DIS)
+ 17.12% : Leveraged Index (LI)
+ 3.74% : S&P 500
Here we are, sitting in cash, waiting for this 'buy-the-dip-rally' to be over and lo-and-behold... the market is selling off this morning. So, now is the time to jump back into inverse ETFs... right?
Well, you 'could' be right. Certainly, the index data, the Sector data and the mid-term moving average data are all pointing toward a bearish investment bias.
From an economy perspective, there is very little reason for this market to move a lot higher. In fact, with the pandemic beginning to resurface in strength in the UK and a few hot spots here in the US, the economic recovery is still mostly on hold. Then, of course, there is the continuing political battle over the relief bill. One side wants to get it out to the people who desperately need financial help. The other side (pathetically) wants to hold it back to keep people hurting enough that they won't vote for the incumbent... at least it seems that way from this observer.
While a lot of the data favor a bearish investment bias, there are 3 unknowns that could push this market a LOT higher; one of which we will know for certain before the opening bell tomorrow. The 3 unknowns are: When the relief bill (euphemistically known as a "stimulus" bill, which it is definitely NOT) is finally agreed to by both political parties; the announcement of the availability of a vaccine; and... the thing that happens tonight... the first debate between Trump and Biden.
While the debate may be a non sequitur with regard to tomorrow's stock market, if Trump or Biden decisively win the 'so-called' debate (tonight's event is more of a Q/A from a moderator than a real toe-to-toe debate), the market might react positively or negatively. At this point, I am assuming the market pops in the morning if Trump wins in a decisive manner and hurts Biden; but that is just a guess. On the other hand, if Biden really takes it to Trump and Trump fumbles, the market might react negatively in the morning. Or... of course... the market might react exactly in the opposite manner in which I think it will, if it reacts at all.
Regardless... there is just too much risk on the table today, to move into a strong bearish investment strategy. But, tomorrow might be a great day to begin putting some capital to work in inverse ETFs.
Tonight... may the best man win!