New Year, new luck!

Long duration growth and bond bear market with pockets of strength! 2022 = 2023!

Nearcast: not all green but pockets of strength!

As I have written: 2022 = 2023.

Market behaves like 2000-2003, long duration (growth) bear market with pockets of strength.

While the Nasdaq lost around 85-90 small cap value momentum was up big from 2000-2002.

Now compare the last year:

High volatility with a clear upward bias.

I have a lot of discussions within my network.

Those are the opinions:

Naive Retail Traders: “Tesla, ARKK, Crypto will be back big time, I am still buying the dip”

Those traders will be burned the most. Old leaders will not be the new leaders!

Furthermore, we are in a bear market for growth (like 2000-2003).

Macro Traders: “This is a risk off market, be as conservative as possible.”

They have a point but will miss out pockets of strength!

Canslim Traders: “This market has no follow through, stay in cash until we have an all-green signal.”

Again, Canslim traders are also right, but they will also miss out on some pockets of strength. Which is fine, because they say “hey, I am not wasting my time for a 10-40% performance with major drawdowns in between, I am waiting and then be very aggressive.”

It is fine to wait for an all-green signal!

My approach is: This is like 2000-2003, 2023 will much be like 2022. A mixed market where value > growth and other pockets of strength.

I will stay nimble but I will trade this market, since there are pockets of strength where I can practice my approach. Not with big money, but with some smaller positions to train the game.

As soon as we get an all green signal, I will expand my exposure.

And of yes, I am hoping for the big crash. But everybody is hoping for the big crash…

The biggest risk is that the market does what it has done in 2022 until naive retail traders are burned and will not come back, until macro traders have been chopped and I am tired of playing setups with not much follow through ;-)

But one thing is for sure: Things will get better at some time. Spring 2024 is my best guess. This would correspond 1:1 with 2000-2003.

We had a bubble everywhere: Bonds, growth stocks, crypto, meme stocks, watches, art, cars, everything was in a bubble. This takes time, a lot of time. But do not lose faith! When everybody lost it and people say: hey I get 6% on fixed income, I am not playing the stock market anymore it will get interesting and better again!

Here are interesting setups for today: