Today, I got yet another newsletter from a well-seasoned market analyst (perks of writing a public column). In it, he says that we can push the rally a little while longer and based it on a few factors including my beloved technical analysis. Specifically, he looked at breakaway gaps on the indices last week and assumed that they would indeed lead to more gains.
While a few more percent to the upside is not unreasonable, and I even left that door open in my column today, his reasoning was based on the typical technical analysis as it has always been practiced. See a pullback, see a breakaway gap, make trade, collect check.
Sorry, not in this market. Indeed a similar event happened in early June as the market broke higher froma trading range. That lasted a few days before the four week correction set in.
Message - do not assume. You make a donkey out of you and your portfolio.