Employment data looked OK, productivity is on the rise and consumer confidence is riding high.
VIX hit a 14 month low and plunged dramatically on Friday's close.
It's no wonder that XIV has been such a $$ success in the M3 model.
And, although the markets are almost comically overbought there's no indication that the party is about to end. Well, there's the technical support/resistance/PE argument that says the markets should go down. There's the seasonal argument that summer is historically an almost net zero game and there's the herd mentality that says the markets are so high they have to come down.
So far, all these contrarian views have proved costly to short sellers and cash holders.
Do I regret not being 100 % vested in M3 over the past couple weeks? Absolutely! But I'm conservative by nature and divide investment capital into several porfolios such as Small World, Gamma, and M3 in order to mitigate risk exposure in the face of market uncertainty.
That being said, it will be interesting to see what catalyst, if any, gives the bulls a reason to head for the exit gate. For now it looks like smooth sailing to new whole number highs.....which the market loves.
