Good day, market enthusiasts—indeed, all the indexes closed higher today. But before you rush to declare an all-out bull market, let’s not be duped by the headline-grabbing numbers. Despite the seemingly robust finish, the underlying market is about as vigorous as a damp match as I’ve mentioned ad nauseam (to a sickening degree), whether you’re on the “traitor” side or a bona fide position trader like yours truly, seize every opportunity to “raise money” when it knocks on your door.
The smart money, unsurprisingly, is piling into the 10-year Treasury. There’s a veritable laundry list of reasons for this move—slower consumer spending, lower corporate expenditures, policy uncertainties from the new administration, whispers of a potential government shutdown next month, and a rather alarming ISM report signaling a possible economic slowdown in the near term. In short, when the economic weather forecast predicts a chance of drizzle, even the sunniest headlines become suspect.
Look at the chart of the past five days for the 10-year Treasury. Notice how it began its downward slide on Monday—not due to any Federal Reserve intervention, mind you, but thanks to the perceived threat of tariffs and a collective dash for safety. Today’s pronounced drop—almost a 4% plunge from high to low between 7:30 am and today’s close—further underscores that investors are more interested in shelter than in chasing flashy tech or high-flying consumer stocks.
So, while you can rest assured that the proverbial sky isn’t falling, this bull market is nervous and weak (no need for any “Chicken Little” panic), remember this: smart money governs the market. Don’t wait until it’s too late. Capital is shifting from the glamorous tech sector to the more staid realms of consumer staples, banking, and utilities. In this nervous, weak bull market, opportunities abound for those who know when to raise funds without being overly choosy about the “gift horse.”
And as an added nugget of wisdom: when opportunity comes knocking, don’t waste time asking, “Is this really it?”—just answer the call. There will always be a better chance down the road, but for now, smart money is clearly playing defense.