Friday’s post-Bernanke action implies the market seems to think that Barrack Obama will hold the White House. When the incumbent party is to win, there is an August rise into an accelerated rise (top example). We have been operating under the middle example, which is the average of all election years, to be on the safe side. In that scenario, we prepare for the routine yet notable correction of the middle example as well as the severe correction and potential bear market that could follow the bottom example, when the incumbent party loses the Presidency.
This segment could go on and on, but I’ve got a newsletter to write. They make the rules and we play by them. So let’s get to it... NFTRH then goes on to the functional analysis that has kept the letter on the right side of the markets over a difficult summer. Stay updated with the free (and spam free) eLetter.