Tuesday, May 30, 2017

Gartman bullish on Technology

"We stand in awe of the sheer relentless nature of the global bull market. Unlike the parabolic rise by Bitcoin, for example, the trend from the lower left to the upper right in global equity prices is measured… is reasonable… is relentless and is, in the end, majestic in nature. It will stop when it stops and not a moment before. Every time we think that the market is overbought, it consolidates and moves higher.

It is interesting then to note that the CNN Fear & Greed Index has been “locked” in recent days a few points either side of 50, where 50 is evenly balanced between the bullish and bearish forces at work. When the Index is below 20 and has turned higher, the market is oversold and due for a rally. When it is above 75 or so and turns down, the market’s over-bought and due for weakness. But at 50 it is neutral… utterly and completely… allowing the trend at hand to obtain a while longer and the trend at hand is clearly a bullish trend.

In retrospect we allowed our prosaic, old-guard beliefs in simple things to color our view of the markets; that is, we have tended to err, even when bullish of stocks, to own metals, trains, boats, bearings et al. As always, we’ve wanted to own them when instead we should have understood the disruptive nature of modern technology and should have been buying the things that are either replacing these simple things or are making these simple things better.

We shall never be able to step into the pharmaceutical equities for we are not able, nor willing, to make implied bets upon whether a drug in place shall meet FDA approvals or not. We’ve not that expertise, nor shall we ever have it. However, we should be able to ascertain what companies will make mining better; what companies will help run railroads run more efficiently; what high-tech companies will replace crews on ships with autonomy et al. That we have to do; that we shall do. The game has changed and so must we."


via ZH