Market Trend Overview

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     Success in equity investing involves the uninterrupted hold of equity based assets for a long period, allowing for the compounding of dividends, retained earnings, and corporate earnings growth ( "time compounding" ), thus leading to a "maximal" terminal portfolio growth. However, for some investors, emotions and behavior may interrupt this process, leading an investor to sell equity assets prematurely ( a behavioral bias known as "loss aversion" ). If an investor absolutely, positively must shift away from equity based assets into defensive assets, it is important to employ an objective and mechanical tactical method that intervenes, only rarely, in the holding process - one that provides a high degree of certainty towards doing so. This process, "Identifying Periods of Risk in the Stock Market Using a Multi-Variables Based Process", is described here                                and whose signaling is updated below, when and if conditions warrant.

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               Market Trend  July 2025 ( updated June 30th )
 

( Trend as described in "Identifying Periods of Risk in the Stock Market Using a Multi-Variables Based Process"  )

 

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States of Signaling Logic: 
 

 1) If, on June 30th or July 31st of the year, the S&P 500 price resides above the moving average = "positive" market trend

  See "Market Trend" section below
 

 2)  A high risk stance for the stock market is warranted for the next 12 months if :

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  a) on June 30th or July 31st of the year, the S&P 500 price resides below the moving average

 

  b) the “year to date” return is negative

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  c) the current Presidential term year is the 1st (inaugural), 3rd (pre election), or 4th (election) year

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  d)  a, b, & c occur within 24 months proximity to a “yield spread” inversion (  the 3 month U.S. Treasury bill yield

being greater than > the 10 year U.S. Treasury bond yield )

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3) On June 30th of the 2nd year of the Presidential term, the market trend is positive irregardless of what

the S&P500 / moving relationship indicates

The tactical strategy signaling is #1 state ( equity assets are low risk )
 with last signal date July 2009 ( see Table 1 below )