S&P 500 Relief Rally has Arrived – Is it a Head Fake?

The relief rally has arrived. After a brutal stretch in the first three weeks of December, the S&P 500 had one its best rallies in seven years, jumping 5.5% from Wednesday to Friday.

You can see the nice rebound in the 12-month S&P 500 chart below.


The S&P 500 is still down 5.4% in 2018 – but as you can see – that 5.5% jump cut the loss in half in just a few days.

Its nice to see a bounce here. Its been a very brutal stretch for the S&P 500. It provides some financial and emotional relief rally for investors watching their portfolios take a beating.

Now – the big question becomes – is this a head fake or the beginning of a sustained rebound?

For now I will say that I think the S&P 500 is much closer to the bottom of this move than the top.

I also make this video providing some context and perspective on this recent sell off.

 

Bigger picture, I am working on a review of 2018 and my outlook for 2019. I will be going into more detail on what I expect from US and global stocks in 2019, the most promising sectors and sharing ideas how we can potentially benefit.

So be sure to stay tuned in for my 2018 Review and 2019 Outlook.

Cannabis Stocks Have Also Been Struggling – But the Long Term Trend is Still Bullish

Following the broader stock market lower, the cannabis sector also had a brutal fourth quarter.

The North American cannabis index fell 41% from the 52-week high. Take a look at the 12-month chart below.

There’s no question this was a very tough quarter for the sector. However I am still extremely optimistic. Here are a few quick points.

  • The cannabis industry is still in its very early stages – I see plenty of growth ahead.
  • I am expecting great things from cannabis stocks in 2019 – I see a number of major catalysts.
  • Cannabis stocks can be super volatile in the short run – but the long-term trend is still super bullish.

I am working on a 2018 review for cannabis stocks and my outlook for 2019. This is where I am gong to share my thoughts on the big trends we can expect in 2019 and the moves we can make to align our portfolios with those trends.

Be sure to stay tuned for my next update.

The Big Picture
The fourth quarter and December have been tough for the US and global stock markets. Don’t lose the faith. Even though they can be painful these sell offs are a natural part of market and economic cycles.

I’ll be back with another update in the next few days when I will be sharing my outlook for 2019 on the S&P 500 and the cannabis sector,

In the meantime, if anyone has questions please feel free to email or call.
  • mike@vodickagroup.com
  • mikevodicka@gmail.com

Your Investment Partner,

MikeThis report is for entertainment purposes only. Every investor should consult with an investment advisor before making investment decisions. The Vodicka Group, Inc. is not a broker/dealer. We do not receive compensation for mentioning stocks. At various times, the clients, publishers and employees of Vodicka Group, Inc., may buy or sell the securities discussed for purposes of investment or trading.

ABOUT THE AUTHOR

Michael Vodicka

Michael Vodicka is the president and founder of the Vodicka Group Inc., a licensed investment advisor (Series 65) and a financial journalist.