The Rom Report: January 31, 2022

When markets are selling off there are temptations to pick a bottom. Stocks have been running with the bulls since March of 2009, after all, and a buy all dips strategy has worked like never before. My long-standing Centurions have watched me buy in the middle of strong corrections, but there is a lot to keep in mind when reflecting on those prior trades. During September 2020 the S&P 500 fell 10.5% and I made money. Some of my trades that month were to the long side and some betting against the market. I had a high degree of confidence, based on the evidence at hand, that stocks were going to continue higher over the next several months. The same thing happened this previous September. Stocks fell and I made money. I had a high degree of confidence, based on the evidence at hand, that stocks were going to continue higher for the next several months.
Another thing to remember is that Firmus is a short-term trading strategy that is extremely effective in all kinds of market conditions. With its consistent track record and low small loss behavior, Firmus is the ideal method for what should be a decade of difficult market action across all asset classes.