There is no shortage of reasons to be bearish at the moment. We have war, oil heading toward USD90, inflation still hanging around and, just to make things more interesting, the possibility of the Fed hiking rates. The Fed meets September 15–16 which means Friday’s inflation report comes at a pretty interesting time.
The market certainly has enough ammunition for the bears. The funny thing is the market still has not really broken. We have had some drawdowns, plenty of volatility and the usual headlines telling us why this time could be different. Yet the bigger trend remains intact.
I was also reminded recently of how quickly investor sentiment can change. One of my partners in the US trades AI and technology stocks and has been getting some rather nasty comments from investors after a couple months of drawdowns despite a strong long-term record. AI and tech are hardly known for moving like fixed deposits so this should not exactly come as a surprise.
That is investing for you. Everyone likes the long-term story until they actually have to sit through a drawdown.
I am not saying there are no risks. There are plenty. There is a difference between having reasons to be cautious and calling the end of a bull market.
For now, I still see the bull trend intact. Until the market tells me otherwise, I’m not going to argue with it.