An Unhealthy Market
One of the reasons I am not rushing to jump back into the market is that it is clearly unhealthy. When 4% intra-day swings happen multiple times in a week and we see 10% intra-day moves there is clearly something wrong. If you assume that markets are supposed to price in most conditions, such rapid moves ought to reflect major intra-day changes in the news. But they don’t.
Even if we consider that markets are far from perfect at pricing in reality (and they are), unmotivated moves of this sort should not be occurring. What is happening is that people are momentum trading, trying to game the system and wring profit out of each little hitch. All this churn is exacerbating every swing, while just clouding the actual movements of the market. Bonddad see this as a consolidation period and haven’t seen anything to indicate that he is wrong, for the short term. But, to me, this more resembles the throes of agony than an orderly consolidation. Which is why I’m still keeping my money on the sidelines waiting for things to shake themselves out.