Obamacare Is Good For The Market

Random Thoughts

Before the Saints game (who dat!?), I was able to hook up with a long lost friend. As usual, conversations quickly turn to the markets. Since he’s a physician, he wanted to know how Obamacare is going to affect the markets. I told him, well, the S&P is at all-time highs, the Nasdaq is at multi-year highs, Drugs are at all-time highs, Biotech-which recently looked like it was rolling over-is coming back and not too far from all-time highs, Insurance is at all-time highs, and Health Services is at all-time highs. I reminded him that after all, I am known as the Trend Following Moron. I try not to confuse the issue with facts see the websites www.dontconfusetheissuewithfacts.com and www.donotconfusetheissuewithfacts.com.

So, how will Obamacare affect the market? So far, so good. The Market seems to like it. Obamacare appears to be good for the markets. And, as long as the market continues to bang out new highs, I’m going to continue to stick to that belief. My personal belief? Who cares. We’re here to talk about trading.

People seem to be passionate about the issues. You can’t let your passion get in the way of your trading. As I wrote in The Layman’s Guide To Trading Stocks, “unless you’re Bill Clinton, what is, is.”

In addition to the aforementioned sectors at new highs, Retail, Transports, Chemicals, I can go on and on, are also at new highs.

So what do we do? Well, since things look pretty rosy, should we run out and buy, buy, buy? Well, I’m still not seeing a whole lot of new meaningful buy setups. This is perfectly normal since the methodology requires a pullback. I am still seeing a few short side setups but I see no reason to swim against the tide. Considering this, continue to focus mostly on existing positions. Take partial profits as offered and trail your stops higher. Put together your momentum list (or pay me to do it for you) and watch for new setups. Get ready to get ready.

Best of luck with your trading today!

Dave
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