The Weekly Trend
The Weekly Trend
Episode 234: Puzzle Pieces
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In this week's episode, David and Ian discuss market results thus far for 2024, the 93% down day witnessed on Wednesday, market breadth, board games, and the benefits and advantages of trend following.
Welcome back to the Weekly Trend Podcast. Today is Friday, December 20th, 2024. SAP 500 currently sitting at 5968. I'm David Zahrling and I'm here with part time in house doctor and Santa's helper, Ian McMillan. You got all the things planned for the kids
ian-host616_2_12-20-2024_120511It's that time of year. Wearing many hats. We got sicknesses. We got holidays. But grateful. Grateful to be here. Another year in the books, Dave.
david_21_12-20-2024_110511Yeah, we're getting close, aren't we?
ian-host616_2_12-20-2024_120511Another year in the books. And Another year of a bull market.
david_21_12-20-2024_110511Mm-hmm
ian-host616_2_12-20-2024_120511I don't know what happens next year. I'm just saying, this year was It was a good year for the market.
david_21_12-20-2024_110511Yeah. No one. No one knows. I will say one thing that makes me nervous is in 24, you know how all these firms come out with their estimates and where the s and p will be at the end of the year.
ian-host616_2_12-20-2024_120511Oh, gosh. Yes, it is that time of the year. Where we get Neat, cute little estimates from people on the south side.
david_21_12-20-2024_110511yeah. People making predictions that shouldn't be, and once you know it for 24, they all underestimated. Now for 25, we're starting to see some of those numbers perk up, and that makes me a little bit, Hmm. But, until price confirms, and I know we had a little shot across the bow this week, but still within an uptrend, I mean, markets don't move in a straight line, but what did we have go on this week that It's worth highlighting for our listeners.
ian-host616_2_12-20-2024_120511Yeah, so Wednesday, a rough day, you know, everything down. I think 89 or 90 percent down day.
david_21_12-20-2024_110511Yeah, it was, it was actually uh, 93 percent of stocks
ian-host616_2_12-20-2024_120511Wow,
david_21_12-20-2024_110511in the NYSE down on Wednesday,
ian-host616_2_12-20-2024_120511right? So then, and breath had been, I'm not gonna go into the breathless week category. Breath had been waning for a bit. And even, I mean, you look at the S& P going into Wednesday, you've been sideways for two weeks since November 29th. Guess it was like, it was one of those Fed things. That's what, that's the quote unquote event. There was a Fed. I don't know. Did they raise interest rates or what?
david_21_12-20-2024_110511they did something,
ian-host616_2_12-20-2024_120511They did.
david_21_12-20-2024_110511even know
ian-host616_2_12-20-2024_120511I don't know.
david_21_12-20-2024_110511something
ian-host616_2_12-20-2024_120511They did something and people. And there's computers sold, stocks, and,
david_21_12-20-2024_110511that that's the story they tell And then same with like, I suppose people could be. I suppose you could say the continuing resolution bill that got put out there and then repealed. It could be the Fed. It could be. There's always going to be a narrative. But what we know is that price moves first and then the narrative is set, right? Because where, where were all those people saying they do a 25 basis cut move or whatever it was that markets are, you know, markets are going to do this. You can't live off prediction, you gotta have a plan. And to highlight your point about breath waning, and this isn't really a fair way to do it, but hopefully it paints a picture, but you know, something like the Dow Jones, which is only 30 stocks, but also something like small caps, is 2, 000 stocks, declining for, you know, nine or 10 days in a row,
ian-host616_2_12-20-2024_120511Yeah.
david_21_12-20-2024_110511your large caps held up steady. And again, I know people will struggle with me using those two indexes breath. I think it's just kind of a characteristic you could highlight that you had those indexes down anywhere from 8 to 12 days straight while the S& P was flat, and that's a market cap characteristic.
ian-host616_2_12-20-2024_120511Yeah, so the S& P, I mean, maybe kind of got a two days of it, so far. At least, we're here on Friday so far, a good looking daily candle. That would, you know, negate some of Wednesday. We'll see where it closes, short term, yeah. Shot across the bow. Intermediate, long term, hard to say that. It's how the damage has been done. Certainly not long term.
david_21_12-20-2024_110511Well, we have, we have price levels below us that would give us clues, like let's say, you know, we're recording this before a market close on Friday, December 20th. Market's allowed to do what it wants to do between the end of this recording and when market closes. If we close below the open today, okay, that would be, I don't want that, but that would be information that the selling is not over and that the market is in search of buyers. But we do have some pretty good mathematical levels, price levels. Below us that would give us clues on who does really have controllers is just part of normal discounting mechanism of trends, you know, because the 200 day moving average is sitting, you know, right 5700, you have some point of controls from the move up where you have equilibrium between buyers and sellers that are sitting near 5800, you have the high from summer. That's sitting at 5, 800. So there's some levels here to pay attention to do buyers or sellers have control of this market. Your point is simply, maybe we go into a correction and that's how it's Wednesday is how you're, how it started, but there's no way to know that ahead of time. And
ian-host616_2_12-20-2024_120511don't know. And if you're a trend, yeah. If you're a trend follower. Yeah. I mean, yeah,
david_21_12-20-2024_110511could also have made the argument back in August and July, you know, that, oh, was that the beginning of a new correction, what happened in July? And once July was over, the market rose, you know, another 15%. So if you had been out at that time because of that move, you know, you'd have lost out on that opportunity. That's just how trends work, is they don't move in a straight line. And we have mathematical, we still have rising 200 day moving averages. And in some ways, make an argument that that's some type of breath, flush that happened on Wednesday that you just had a lot of stocks go search out their 10 week moving average or their 50 day moving average, right? Because you saw, you saw a big jump in stocks that did that. And that happens in uptrends all the time where you come back and test your prior 10 weeks of information averaged or your prior 50 days.
ian-host616_2_12-20-2024_120511Well, and you got, you and I talk about it on the side offline. I mean, all the time, like, you know, you're like, listen, months. Like November are fun and you get to watch the run up and you make a lot of money and it's great, but. But you know that even in a str like there's going to be some type I'm gonna take some of that back. It's gonna be some type of punch to the gut. Think if you accept that beforehand, it's a lot easier. To sit through a wednesday and thursday.
david_21_12-20-2024_110511Well, yeah, we know, we know that the average year is going to have at least one 10 percent corrective move and multiple three to 5 percent moves. And what's interesting is just the, the volatility spike we saw on Wednesday. And I don't think it's coincidence that rather than talking about the Fed or continuing resolution bills, that we've got a dollar, trade weighted dollar above 107.
ian-host616_2_12-20-2024_120511yeah, that was not great Well in the current you want you want to cost we're in we're still in the strong We're in a strong dollar is bad, you know market mindset right now that could change or whatever But yeah the dollar breaking out above 107 and ariad has tested quite a few times this 106 107 Back to where we were two years ago.
david_21_12-20-2024_110511Well it, you know, you've, you've highlighted in the past on here that there's times where strong dollar is good and it's Then there's times where it's bad, and these correlations go in and out you know, for example, dollar's been rising pretty strong since October, the start of October, and S& P had been moving along with it, but now that we're above 107, which is this behavioral level that goes back, what did you say, two years? Where they've sold it in the past and we're now above that, now you're, you open up your mind to the possibility that if the dollar continues, that maybe that's not great for Risk assets because even something like Bitcoin pulled back. So we'll see What other things you know, are there any I guess lines in the sand that you're looking at on any other? You know, you shared a nice internal chart about small caps.
ian-host616_2_12-20-2024_120511Small caps and mid caps again, we're getting a bounce today. We're, I mean, we're below where our pre election closing. So that Tuesday, November 5th, before we got the gap higher,
david_21_12-20-2024_110511Mm hmm.
ian-host616_2_12-20-2024_120511small caps and mid caps back below there. Failed breakout for Russell small caps on this. Like if you use IWM, let's call it two 30. Same thing that, you know, we had this in 2021, So we'll see, it can fix itself. But I'm fortunate maybe it goes sideways. Of course, I wish we could have gone sideways above support. But it's not the cars that the dealer dealt me. It's frustrating.
david_21_12-20-2024_110511yeah, the market didn't give you what you wanted.
ian-host616_2_12-20-2024_120511I did not get pocket aces.
david_21_12-20-2024_110511Ha ha ha. To add to this, we are entering game season. For, for at home, like with your kids and
ian-host616_2_12-20-2024_120511Oh yeah, oh yeah. Big.
david_21_12-20-2024_110511teaching them, you know, spades, euchre.
ian-host616_2_12-20-2024_120511Yeah, you're inside for the winner.
david_21_12-20-2024_110511Yep.
ian-host616_2_12-20-2024_120511bust out the cards in the board games.
david_21_12-20-2024_110511Mm hmm. They're fun, man. It's a way to get, it's a way to get the kids off their devices,
ian-host616_2_12-20-2024_120511my gosh.
david_21_12-20-2024_110511with anybody. It's
ian-host616_2_12-20-2024_120511Off the devices.
david_21_12-20-2024_110511What games do you guys play?
ian-host616_2_12-20-2024_120511Candyland. Classic.
david_21_12-20-2024_110511Yes.
ian-host616_2_12-20-2024_120511We're in the math stage 2, so honestly, like, flashcards are fun. Like, math flashcards.
david_21_12-20-2024_110511Right.
ian-host616_2_12-20-2024_120511He enjoys those. We have like a bingo, like an NFL bingo that he likes to, or, yeah, it is a bingo, yeah. Like spin the wheel, it's like NFL mascot bingo. Loves that.
david_21_12-20-2024_110511That's awesome.
ian-host616_2_12-20-2024_120511Yeah, so those are, and then puzzles, he's a big puzzle kid. So puzzles are a good indoor activity.
david_21_12-20-2024_110511Yeah, puzzles are fantastic. One of my favorites, my wife always does a puzzle over Christmas. It's just the thing she does with her sisters and her mom. Typically wine is involved. I don't know if that helps him or not.
ian-host616_2_12-20-2024_120511Do you tell her that you do a puzzle every day called the S& P 500?
david_21_12-20-2024_110511I do, I do. They rearrange the pieces out of me.
ian-host616_2_12-20-2024_120511Yeah. Overnight. Like, Hey, I had this a lot. I had a lot more of this puzzle put together when I went to bed. Okay.
david_21_12-20-2024_110511right. Who's been messing with my puzzle? Well, they get the, the new game in our, in our household that and I think you get, I think you're gonna have to wait till your boys are a little older. Not'cause it's like PG 13 or anything like that, but it's called the chameleon. It's really good. Like the way you, you, everybody gets dealt a card and then you roll these two dice and then it tells you on the cart there's like a grid that you look at and it's, you know, it might have a theme like, I don't know, countries of the world. And you got a, has a card that tells them where on the grid, which country it is. And then they give a clue about the country that they're looking at. But someone's a chameleon, they get handed a chameleon card, and they have no idea which country it is, but they kind of listen to people's clues and try to figure out, and then people have to guess who the chameleon is. It's fantastic. There's a
ian-host616_2_12-20-2024_120511Okay. Okay. It sounds,
david_21_12-20-2024_110511a of finger pointing. It's great.
ian-host616_2_12-20-2024_120511that is great.
david_21_12-20-2024_110511enjoy that.
ian-host616_2_12-20-2024_120511Are your kids your two oldest are home for the break? Are they done with exams?
david_21_12-20-2024_110511They are. Done with exams, finished strong, home for break. Okay. The house is full. We're down to three teenagers. My oldest just turned 20. And it's a great time and thankful for the driveway we have because we've
ian-host616_2_12-20-2024_120511Yeah, I bet you are.
david_21_12-20-2024_110511we've got three kid cars out there and with the snow falling it's kind of hard to get them off the street So it's great. We're able to do that, but it's great man. It's great to have the kids come home Even when I annoy them, it's great.
ian-host616_2_12-20-2024_120511I mean, they wouldn't, they wouldn't be home if you didn't annoy them.
david_21_12-20-2024_110511Yeah, correct. That's my job I tell them that all the time.
ian-host616_2_12-20-2024_120511That's what dads do.
david_21_12-20-2024_110511It's what I do. It's why there's literally a category called dad jokes That's where I live. So you and kevin did a great job last week covering a variety of topics we talked a little bit about S& P 500, the Dow, small caps. What about like sectors slices of the market, whether it's for the year or the last few months? Cause one of, you know, one of the things you want to look at is we've had such, such a strong uptrend this year
ian-host616_2_12-20-2024_120511Mm hmm. So,
david_21_12-20-2024_110511from, but just as importantly where it didn't. And then where did that match up with Wednesday's shot across the bow? You know, were there any things that held up better than others? Any insights there from a sector perspective that you're looking at?
ian-host616_2_12-20-2024_120511you know, I think pretty good year. All sectors finished green. Your top sectors for the year, communications, financials.
david_21_12-20-2024_110511Well,
ian-host616_2_12-20-2024_120511Discretionary tech and utilities. So a good mix. I don't think you can say that was a heavy growth year, a heavy value year. Mean we had a great bull run and we had utilities above industrials, healthcare, energy, materials. And then you want to take it a level below that to the sub industry. Not a good year, semis. But then you had Argentina. You had big year for the crypto names, especially later in the year.
david_21_12-20-2024_110511for sure.
ian-host616_2_12-20-2024_120511You know, we, we talk about these a lot internally within financials, capital markets, and securities and broker dealers and exchanges. Homebuilders actually had a pretty good year.
david_21_12-20-2024_110511So not exactly risk off by what you're telling me.
ian-host616_2_12-20-2024_120511Not risk off. High beta outperformed. I mean, You've had a really good smattering of everything, I think. Yeah, a little techie ish. But, I don't know, like, everything's kind of tech. I mean, aren't, like, what's that saying? Like, Tesla's not a car company. It's a technology company.
david_21_12-20-2024_110511sure. Great.
ian-host616_2_12-20-2024_120511know, Amazon's not a, mall on the internet. It's a technology company.
david_21_12-20-2024_110511Great.
ian-host616_2_12-20-2024_120511I kind of buy that for, I mean, heck Visa is, Visa's in technology now. The stock, it's in the technology ETF.
david_21_12-20-2024_110511Yeah, FinTech,
ian-host616_2_12-20-2024_120511Yeah. I mean,
david_21_12-20-2024_110511tech.
ian-host616_2_12-20-2024_120511there's a lot of gray area there now in general.
david_21_12-20-2024_110511You know,
ian-host616_2_12-20-2024_120511Trying to think
david_21_12-20-2024_110511too is even commodities using something like GCC Is likely to finish positive on the year, you know, it isn't going to likely finish positive on the year
ian-host616_2_12-20-2024_120511what,
david_21_12-20-2024_110511good old fashioned long duration government treasuries.
ian-host616_2_12-20-2024_120511Well, yeah, I guess it's hard to finish negative. I mean, they just this week. Almost, almost went back to one year lows. Back to where we were in November of last year. We're getting a bounce today. But absolutely, it's just tough. I mean, I guess if you're there for the income, and you're gonna hold it for 20, 30 years, I, I guess, get your cash flows. But you could get those in short You should get those in You can get the same cash flows in T bills.
david_21_12-20-2024_110511Yeah, correct.
ian-host616_2_12-20-2024_120511And get the capital appreciation.
david_21_12-20-2024_110511I mean, we're still 92 percent away from the highs in 2020 for TLT. And you look at AGG, right? The aggregate bond complex.
ian-host616_2_12-20-2024_120511Yeah, so is it bad across the board? I
david_21_12-20-2024_110511Well, it's, yeah, using AGG, you're still down 18 percent from the highs and to get back there. Is 23%, but you know, you brought up T bills, right? T bills didn't have that type of decline and they still pay out about a 5 percent coupon. You know, your CLOs and your middle tranche, triple B's doing better, even like your things over in the Pacific.
ian-host616_2_12-20-2024_120511mean junk bonds, the worst bonds in America are up. How much this year? Like probably four or five percent without the dividend.
david_21_12-20-2024_110511Yeah. So, I mean, the 60 40 portfolio, I don't know how many times we have to say it is really under duress.
ian-host616_2_12-20-2024_120511It is, and it's a rising rate. I mean you cannot be shocked when rates go sideways for three, four, six months a year and then they resolve to the upside.
david_21_12-20-2024_110511Right.
ian-host616_2_12-20-2024_120511You can't.
david_21_12-20-2024_110511The rising rate environment began in 2020. I, I just don't think that's getting enough coverage. That it's likely that your kids are going to be in their mid 30s again until we see the return of a falling rate environment.
ian-host616_2_12-20-2024_120511Yeah, and you see, I mean we had Kevin sees this a little bit more than I do. We had a transfer in last week. And you know, you're in there, right? You're shifting them out of what they were in at their previous advisor and into your models. And so frustrating to watch just the exposure to long term treasuries because it's part of this textbook. Well, they need, they need fixed income, right? This is their risk tolerance. Says they need fixed income. Okay. I'm I'm okay with that. Like I can meet someone there but Then do the extra 15 minutes of work and figure out what pieces of fixed income are in uptrend It doesn't take that long.
david_21_12-20-2024_110511Right. You can do the work.
ian-host616_2_12-20-2024_120511You can do the work, and it doesn't have to be a one off, like, I mean, have models, like, it's, don't have anyone involved, I don't, it's frustrating because I know it can be done. We do it.
david_21_12-20-2024_110511Please tell me it wasn't one of those with like a thousand positions in it.
ian-host616_2_12-20-2024_120511It was, yeah, like 15 or 17 different mutual funds and of course you gotta have, they had a mid cap core and a mid cap growth. Big alpha generator there, you know, just, I mean, pick, I'm fine with being makeup, but like pick, I guess like pick one. I don't, I don't know. Again, it's one of those things that screams, I don't know what's going to happen. Okay. I also will meet you there. I don't know what's going to happen either, but I mean, I can put more effort into it than we can put more effort into it than
david_21_12-20-2024_110511Throwing darts at the board?
ian-host616_2_12-20-2024_120511throwing darts in the board and saying, well, here's 20 things and. I know at least five of them, five of them should do pretty well.
david_21_12-20-2024_110511yeah, we should be able to create a math problem and then solve it. Also known as ratios. Right.
ian-host616_2_12-20-2024_120511Yeah.
david_21_12-20-2024_110511You know, put, put all your fixed income funds or ETFs versus AGG if you have to hold fixed income and see which ones are in an uptrend and which ones aren't and keep it that simple. And then do the same thing with your equities, right? Keeps you out of trouble with international equities with
ian-host616_2_12-20-2024_120511Yeah.
david_21_12-20-2024_110511Argentina and a couple others.
ian-host616_2_12-20-2024_120511Keeps you out of long term treasuries.
david_21_12-20-2024_110511Because part of the process is, it's not only what you own, but just as importantly, what you don't. And there's a process for that again, like Ian said, we don't know what the market's going to do. We don't, but we know that factors such as momentum and trends exist in the market.
ian-host616_2_12-20-2024_120511Yeah,
david_21_12-20-2024_110511And we might as well use those probabilities and tilt them in our favor that those things that are trending will continue to trend Including ratios, so put those in your favor them in the portfolio. They're not 100 guarantee They never are but at least you're increasing probabilities Rather than increasing probability is the opposite way that you'll continue to hold a loser And then you're in a psychological conundrum because you can't sell that now.
ian-host616_2_12-20-2024_120511I agree. I think it, you know, to your point, it's not some magic potion. No one's saying that it'd be a trend follower about a thousand, but from a risk reward standpoint, I think what's been proven over, you know, market's been open 140, 150 years, it's been proven that the market is, you know, At any given time, the market is more likely to just keep doing what it's been doing. And that's how you get trends. That's why the Dow has gone from 40 to 45, 000 over the last century.
david_21_12-20-2024_110511You know, the, the infamous Marty Zweig said the trend is your friend until the end when it bends.
ian-host616_2_12-20-2024_120511Yeah. And that's just, and that's an art, right? I don't, I don't know. It was Wednesday of the bend was leading up to Wednesday of the bend. Well, I mean, it depends, right? And that's up to you, the investor, the trader to decide what a trend is to you. Doesn't have to be the same as it is to Dave and I,
david_21_12-20-2024_110511Yeah, for us, it's, it's relatively simple. Higher highs and higher lows. That's one way. And then you have a rising average is another way. And right now we continue to have both. We have a rising 200 day in many aspects, a rising 50 day, and you have higher highs and higher lows
ian-host616_2_12-20-2024_120511and you can be
david_21_12-20-2024_110511It's an uptrend.
ian-host616_2_12-20-2024_120511on a 15 minute chart can be on a monthly chart.
david_21_12-20-2024_110511Yeah. I know that's not sexy. I know it's not pontificating about global macro or geopolitical or different accounting metrics. I know that's, you know, those are, those are more fun topics around the Christmas fire than trends. But I rather be involved with trends and make clients money, then come up with my own story and not.
ian-host616_2_12-20-2024_120511I would probably never. I would just probably never be involved if I was worried all the time.
david_21_12-20-2024_110511Yeah. Worry is a big one. Well, that's just it. Trends are a psychological and bias bodyguard.
ian-host616_2_12-20-2024_120511Yes, they are definitely a bodyguard. Today's like Wednesday. You're like, okay, well this has to be it. It's the end of the year. They don't like Trump. Everyone wants to be out or up over 20 percent for the last two years. They're not going to get their omnibus bill. Elon's making decisions. But it, you know, that's doesn't affect the trend of anything.
david_21_12-20-2024_110511Right. And the flip side is true too. When there's a downtrend,
ian-host616_2_12-20-2024_120511Yeah, that's true.
david_21_12-20-2024_110511that helps you stay emotionally stable for those events as well. Just the
ian-host616_2_12-20-2024_120511August was supposed to be the rollover with the yen event.
david_21_12-20-2024_110511Mm hmm.
ian-host616_2_12-20-2024_120511That was a bottom. And we had, and that, right? And we went, we had gone down for two weeks into that. August 5th. It was, I'm pretty sure it was Monday, August 5th. We had gone into that. Something happened Sunday night. Markets gapped down. Well, I know it was some yen thing. I don't know. I don't. It's much better for myself and my family if I just don't go in to worry about those things too.
david_21_12-20-2024_110511Right.
ian-host616_2_12-20-2024_120511know, yen. I'm not gonna read about it.
david_21_12-20-2024_110511Yep. Turn off, turn off the TV. Go play a card game. It's the best way to go about it, really.
ian-host616_2_12-20-2024_120511And guess what? It was a nothing burger.
david_21_12-20-2024_110511Right,
ian-host616_2_12-20-2024_120511Eventually, we'll have a something burger.
david_21_12-20-2024_110511yeah, we
ian-host616_2_12-20-2024_120511Eventually. Big fat something burger.
david_21_12-20-2024_110511Yeah, as we've said in the past, shut up and enjoy the trend. It will change. There will be a day. And I think one of the first clues to look at would be if we're supposed to be seasonally strong now through April.
ian-host616_2_12-20-2024_120511Yes.
david_21_12-20-2024_110511What does now through April actually look like? For example, the second half of this month is supposed to be strong. That might be clue one. If we don't have a second half of December that's strong, that would be a point to sit up and take notice. Okay, maybe buyers are starting to lose control of this market. And especially if Q1 of next year we don't follow through, that would be information two. And then if that's happening, it's also likely happening in conjunction with losing important levels.
ian-host616_2_12-20-2024_120511Yes.
david_21_12-20-2024_110511in the market. I wish I could make it more complex and sound smarter, but I'm just a dumb guy using technical analysis for my edge.
ian-host616_2_12-20-2024_120511And so you go, all you know how to do is draw squiggly lines.
david_21_12-20-2024_110511Yep. Look at a chart. Thousands of them. Thousands of charts. So what else, Ian, do we want to highlight?
ian-host616_2_12-20-2024_120511Good year for crypto.
david_21_12-20-2024_110511Yes.
ian-host616_2_12-20-2024_120511about that, but the, the coins, Bitcoin, I mean, we're back under a hundred thousand right now, which is of course a big, Big thing to talk about it. But overall I mean, huge year for crypto. We came into the year Bitcoin around 43, 000. We made it up to 107 currently sit at 97. We'll see how that plays out. And a lot of that was nothing. I mean, we had a big run, In February, Bitcoin goes from 40 to 72 in basically 5 6 weeks. Then we do nothing until election night.
david_21_12-20-2024_110511Yeah, that's
ian-host616_2_12-20-2024_120511Big old fat range for 7 months, 8 months? And then we move from 73 to 107.
david_21_12-20-2024_110511You know, I might start using that as like a way to tease my kids. You know, like if they wear socks to bed or they put the toilet paper on backwards, I might call them a communist or something like that. I might just call them a big fat range.
ian-host616_2_12-20-2024_120511Yeah, it's the big range.
david_21_12-20-2024_110511You're acting like a big fat range right now.
ian-host616_2_12-20-2024_120511Sloppy. No one wants to be involved in that. You look like a flat 200 day. I don't hang out with flat 200 day moving averages.
david_21_12-20-2024_110511are you acting like You let me know when you're in an uptrend, and then we'll talk.
ian-host616_2_12-20-2024_120511Go back to your room. You let me know when you're ready.
david_21_12-20-2024_110511That's right. I only deal with uptrends. Figure it out. Yeah, I'm gonna use that. See what happens. I'll let you know. I'll report back.
ian-host616_2_12-20-2024_120511Yes,
david_21_12-20-2024_110511Everybody on the
ian-host616_2_12-20-2024_120511a good year to you. I love and you harp on this so much and it is so true. It is the, I think, one of the most important things that you've got to just constantly keep in mind is just be grateful. Be grateful. It was a great year. We don't know what's on the horizon next year. Hope you were, you know, capitalized. It's been an uptrend. It hasn't been too choppy. I don't even know if we got one. Did we get a 10 percent correction this year?
david_21_12-20-2024_110511Yeah, that one in July, I
ian-host616_2_12-20-2024_120511Yeah, you're right.
david_21_12-20-2024_110511I don't think it reached 10 percent though. It might have been
ian-host616_2_12-20-2024_120511Eight and a half.
david_21_12-20-2024_110511Yeah. for all intents and purposes, pretty low volatility
ian-host616_2_12-20-2024_120511It was.
david_21_12-20-2024_110511for, for the whole year. And exactly. It's kind of like, you know, when you have a great Vista, a great view, you're whether you're on a Lake or, you know, you're, you're sitting on the edge of a ski slope, looking over the mountains, worry about other stuff. Just enjoy that view in that moment. Just enjoy this, enjoy the uptrend. Like you said, hopefully you were allocated, participated. There will be a day to protect. This was a year to participate. There will be a year to protect. And we'll know that when certain levels are breaking. It's why we use certain processes and triggers on our side. And I know the, the partner and supporter of this podcast, Select, uses something like that. And Adaptive Select is on the NYSE under ticker ADPV, which helps investors access two of the most prevalent factors in markets, momentum and relative strength. Using proprietary identification methods, the Adaptive Select ETF attempts to own the strongest 25 large cap stocks the market is in an uptrend. since not all market environments are the same, Adaptive Select seeks to prevent extended declines by moving to short term treasury bills and cash during long term market downtrends. Investors can find out more, including how to invest in ADPV by visiting ADPVETF. com. We're calling 1 833 880 5200. Investing involves risk, including possible loss of principal. Distributed by Quasar Distributors LLC. And that's, that supporter, that ETF, a metric to identify what type of regime we're in.
ian-host616_2_12-20-2024_120511Good for them.
david_21_12-20-2024_110511Yeah, it's, been in an uptrend. There will be a day where we're in a downtrend. And you have to adapt. Not all market environments are the same, and so, you know, we've had a nice year this year, but 2025 does not have to be the same. Not all years are the same. And she's how many years have you been involved in markets Ian? And they're always throwing curve balls,
ian-host616_2_12-20-2024_120511Always.
david_21_12-20-2024_110511always rearranging the puzzle pieces.
ian-host616_2_12-20-2024_120511We've had back to back 20 percent years. When we, we again, we're two years off of a bear market, so You You know, statistically speaking, we should have some time left in this.
david_21_12-20-2024_110511Right. You're just
ian-host616_2_12-20-2024_120511But yeah, is it 20%? I don't know. I mean, some years you're negative until December, some years you're positive and then it all gets, I mean, markets, you can get to January 1st and say, oh, well, we were, market was up or down, but there's also the context of, well, how did that, how did that happen? What does that look like on a chart?
david_21_12-20-2024_110511You're saying markets don't move in a straight line?
ian-host616_2_12-20-2024_120511I wish they did. God, I'd be so rich if they did.
david_21_12-20-2024_110511Yeah. Wouldn't that be great?
ian-host616_2_12-20-2024_120511That'd be, that'd be pretty sweet, but they don't.
david_21_12-20-2024_110511yeah, your point is, you know, from Volmageddon on January 2018 on, right, we had the correction in 2018, the COVID correction in 2020, 2022 correction.
ian-host616_2_12-20-2024_120511Yeah,
david_21_12-20-2024_110511So you had over a five year period, three corrections of 20 percent or more, which typically we average one every four. And to your point, when bull markets take place, we're still in like the middle innings, potentially, that's not a guarantee. It's just when we track bull market data, just because we've had an uptrend for two years, doesn't mean it can't continue. And so you have to err on that piece of evidence that it's an uptrend until it's not, we'll find out maybe, maybe the Wednesday, Wednesday was the start of something, but we won't know until those levels we mentioned before are broken the downside. And so we have proof. sellers have control of this market. It remains an uptrend. I wish I had something more complicated to say. I really don't.
ian-host616_2_12-20-2024_120511well, you got a couple weeks to think of something. So please for the next podcast, come up with something much more complex and deep.
david_21_12-20-2024_110511I'll try.
ian-host616_2_12-20-2024_120511Why would I let you manage my assets if you can't even come up with a deep complicated theory on your portfolio positioning?
david_21_12-20-2024_110511Yeah. People do love complex
ian-host616_2_12-20-2024_120511Are you dumb, Dave? I should have, I knew I should have given it to the guy that went to the Ivy League school.
david_21_12-20-2024_110511Great. Exactly.
ian-host616_2_12-20-2024_120511He's got 37 positions in my portfolio and he's got a reason for all of them, Dave.
david_21_12-20-2024_110511So true. it's so true, but you bring up a good point. We're not going to record next week, taking a week off for Christmas. We hope everybody that's listening has a wonderful Christmas. with their families and enjoys the new year. We'll have a new episode out in 2025. It's crazy, Ian, how every year you get to, let's call it July 4th, and the second half of the year just flies by. I can't believe we're here already. You know, 46 episodes for the year. We hope everybody really, really enjoyed them. Ian, you really provide our listeners great value. And so I really appreciate doing these with you. And I want you to enjoy your Christmas with your family. I know you're doing that next week. That will be, I can't wait to hear the stories. I hope your family feels better, gets better, and enjoy it. But everyone listening, thanks for a great 2025. Give us a high ranking on your favorite platform. sure you share this with others. And if you're bored over Christmas, you can re listen to one of the episodes. I'm not going to hold you back. With
ian-host616_2_12-20-2024_120511back to our January episode when S& P was breaking above 4, 800.
david_21_12-20-2024_110511yeah, that's a good one. That's a good one. Any of the episodes in January will give you a good clue about how we think about things and our process for adapting to different market environments. But I appreciate you, Ian. Merry Christmas to you and yours. And thanks everybody for listening.
ian-host616_2_12-20-2024_120511Have a great weekend, everyone. Merry Christmas