Yes, based on the market action so far, it seems like that.
How far can we expect this market to move before significant reversal!!!
Million dollar question.... Isn't it!!! Based on market behavior so far and our analysis/comparison to identical action in early 2008 (shown in our analysis last week), it seems like market will push higher for another 7-8% gain before a significant reversal. This might take another 3-5 weeks to reveal the action...
Remember, market can do whatever it wants. Market has a tendency to penalize maximum people. When the rally started early October, many were very skeptical about it. By mid-October the skepticism was running very high and many had bearish view of the market which is a perfect recipe for market to penalize all those who are in denial of the rally. All those who missed out the rally so far will now start jumping in the market in anticipation of strong year end rally. This will provide more fuel to the rally for another 2-3 weeks. By mid-November, earnings season is over and we are back to US Debt reduction issue. Market will start dragging down and many will expect it to be a pullback but that might be the perfect recipe for the market to reverse and penalize most people.... we will find out in time!!!
What does it mean for our Long Term Investment Accounts!!!
401K/HSA/College Fund: We should be fully invested by now in the highest ranked Mutual Fund available to us. You can find the highest ranked Mutual Fund by using the spreadsheet available here.
Traditional IRA/Roth IRA: Based on our "Advanced Strategies" section we should be fully invested in ETFs using our BULL market ETF list and invested in the highest ranked ETF.