My clients and partners know that I have been a rather stubborn bull for quite a couple of years now and my long-term positions clearly reflect that. Please do not get me wrong. I’m not a perma-bull who sees rainbows all the time. In my 30 years as a trader and investor, I have turned properly bearish before and for very good reasons.
I believe in trends but I also believe in survival. Even bulls know when to step aside preferably before they become steak. That said, an update by Callum Thomas that landed in my email inbox caught my attention.
Here is a section:
80% of the world is in a Bull Market. Specifically, 80% of the 70 countries we track are up at least 20% off their 52-week low (with +20% being a common benchmark/trigger for “bull market“). This is a very positive sign.
The below chart shows this peculiar breadth indicator over time (the red line), and what’s interesting is a few things…
First, this indicator has rarely been above 50% over the past couple decades (yet, it was steadily north of 50% during the 2000’s global equity bull market).
Second, when this indicator surges like this it is typically a very good sign. For instance, see: 2003, 2009, 2020 (the start of new global equity bull markets).
Third, by contrast the time to be concerned is when this indicator peaks and rolls over (no signs of that at the moment).
