Still sitting in G Fund, but watching. These are a few of my observations:
Long Term
I think that long-term we're headed for a recession. I expect there to be huge bear market rally's along that wide band descending channel. But, long term you'd have to agree that we are trending down. There is a war in Ukraine. Inflation is hot and the government is working to reduce it. Markets might seem bullish at times throughout, but the Fed eventually breaks something on the way to getting inflation under control.
Short Term Alternative 1
News driven fluctuations in the market. Do we really see good news coming in the short term? I'm not very hopeful. Opportunistic, in and out moves would be what I'm leaning towards if we follow this channel. I wouldn't trust the direction of this channel as long as the Fed is trying to fight inflation. And, inflation will be front and center in the mid-term elections, so there's the possibility of lots of political promises and predictions to muddy things up further. We still have restaurants and other retail stores that close early because they don't have folks to work the jobs.
Short Term Alternative 2
This channel represents a slow grind down, a continuation of the long-term trend. I think it's more likely than not given the current economy and practically every talking head that I pay attention to says that a recession is inevitable.
Bottom line, I think there will be ample opportunities to make some money, but we have to be much more patient than in the previous two years in looking for those windows of opportunity. For me, that means being much more conservative with my percentages and will have spent a lot of time MOSTLY in the G Fund trying to figure it out. I'm in preservation mode right now.
