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Both global equities and the bond complex moved higher on the week. The recent run up in prices has created a lot of “winners” who will act to aggressively protect recent gains once apparently negative information rears its head. Quick gains are fragile gains. News flow has been good, economic data in the U.S. have come in good, price increases have been good. The party continues until it doesn’t. Simply be aware that a swift and sharp correction is a distinct possibility. A sharp decrease in equity prices of 10% or more over the course of a few days is not out of the question.
For dip buyers, the last few weeks have been challenging as the S&P gave few good potential entry points. For value buyers, as price runs up, value becomes harder to find. For the long term buy and holders, hopefully most of the buying was done in a prior period and therefore the holding part has been enjoyable. For the long term buy and holders, see the paragraph above and don’t be surprised or shaken if a correction occurs.
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