Morning Report Friday 14 March 2014
I remain bullish equities over the next 1-3yrs, but as I have often said, the chart of the rally will resemble that of a zigzag. The bull market is maturing.
I believe US equities have commenced my anticipated 6% correction, with ~4% to go, perhaps even a little more with respect to the Dow.
The ASX200 has proven harder than the US to predict in 2014, but if the Dow is looking for a 650+ point fall from here, there is no hurry to buy in Oz.
Australian banks have rallied on average 5.7% pa in March / April since 1997 as investors get set for dividend payments in May (www.probabilitytrader.com)
Subsequently, the logical trade at present is to sit on decent cash weighting, ~30% of total portfolio, looking to buy Australian banks if / when they retrace in lieu of the anticipated correction I'm the US.
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