Education & Information
Market Analysis
Too often, investors, both individual and professional alike, have the same approach to the market. Some are always bullish while others are always bearish. No matter what happens, they do not change their mind. The financial markets are not a static mechanism. The same approach doesn’t always work. A common mistake amongst most investors is they have pre-existing opinions about market conditions. An investor cannot make the markets conform to their way of thinking. You can’t make the market do what you want it to do. The most successful professional investors are not rigid in their investment thought process. To be consistently successful, an investor has to learn to adapt to market conditions and manage your portfolio accordingly.
Our market analysis starts with a thorough analysis of supply and demand relationships on the New York Stock Exchange and NASDAQ markets through the use of the NYSE Bullish Percent Chart and NASDAQ Bullish Percent Chart. When supply is controlling market action we employ an overall defensive strategy. When demand is supporting higher stock prices, we adopt an aggressive strategy.
The NYSE and NASDAQ bullish percent charts are intermediate to longer term market indicators. We also study shorter-term market indicators to get a flavor for risk levels and market direction over shorter time frames.
In addition to supply and demand relationships, we also utilize broad market relative strength charts to identify the stronger and weaker markets. This helps us to focus our efforts in the stronger market and avoid our exposure to the weaker market.
Through thoroughly analyzing these indicators, we can adjust our market approach to current conditions. We define our management style as dynamic, not rigid as most investment managers are. We can understand market direction and risk levels at any given time.