The current pullback is good for the health of the risk asset market. If we have a non-stop increase, then it is time to get concerned.

When we get a vertical rise in the equities, it means that the amateurs are all jumping on the bandwagon to not miss the ride. At that juncture, it will be time to leave the party. When everybody is really excited and the trend is fully established, then usually it is too late to get in. That is the reason why folks buy high and sell low. The market is a small arena as much as everybody thinks it is very big. Once everybody does their buying, and the bids dry up, then there is only one direction for the market to go; Down.

This is not the case right now. Many people are still haunted by the 2011 sell-off during August and October. Most likely the S&P and Dow will make new highs several times during the next couple of months. This ride is not over yet. The uptrend is still intact.

Our subscribers are in good shape if they have followed our timely signals and bought low several months ago. Remember you don’t make money by selling. Profits are made by buying low when everybody is absolutely scared of owning the asset you are buying.