@slats1961the stock market works in phases that reflect economic...

@slats1961

the stock market works in phases that reflect economic phases.

we're coming to the final 2-3yr phase of the overall uptrend in stocks. 

in the late phase - interest rates lift (how much depends on the cycle, inflation lifts, normal housing cools, office/tower construction peaks, commodity prices lift). this cycle though is complicated by China now acting as the 2nd cylinder to global growth - where for years it was largely the US

so you'd be wise to take it all with a grain of salt to an extent - but china's emergence is one reason why this economic cycle is longer than most - it broadens the global economic cycle

in late cycle, because interest rates rise, household wealth peaks (house prices stop rising and inflation starts capping/reducing real wage growth)

- tech starts to moderate - top leaders still lead - small caps become very stock specific

- materials rise (bhp, rio, wpl etc etc)

- banks fall (while net interest margin rises its actually a fallacy that drives bank profits - banks have huge asset books and as asset values fall bank profits fall due to increased bad debt provisions plus asset value writedowns)

however this is an exceptionally mild cycle to this point not much real growth nor much real inflation - so volume indicators on sectors/stocks are the key - the shifts in valuations will be driven by capital flows as much as by real economics - so thats where you need to look for entry points

many many places to make money in the stock market - but because its wishy wshy economic setting - its largely driven by smart money picking a stock up - selling it to retail - then moving on to the next - rinse and repeat

wbt for theory tech was massively op at $100m mkt cap - now it is a reasonable entry point.  but nothing suggesting any imminence of a re-rate on what ive seen - so could well drop again before it moves significantly north. then again may not.  nothing to say either way - although pre cashflow stocks tend to keep dropping til they have a catalyst to move up

technical trading is key in this environment imo/ gltah