In last month’s update, I wrote: As of the end of February, the top green line is providing support for the S&P. The real question is, Will it hold? Over the past month the market has provided the answer. As of the end of March, the S&P has fallen below both the green Resistance line, and at least for now, the Blue Line. I have identified this with a red circle in the upper right-hand corner of the chart.

 

STOCK MARKET, THE TREND:

Chart courtesy of StockCharts.com

 

Here’s the most important point I want to stress in this update. Audiences are tricked by magicians when the magician gets them to focus their attention on one hand when they should be focusing on the other. In like manner, the media prints headlines to get investors to focus on the wrong hand. I don’t believe investors should pay attention to media headlines; they should be focusing instead on the market behavior (the other hand). This is where technical analysis can be very helpful.

IF a Channel Correction were to unfold during 2025, we should expect the S&P to rally back to the green Resistance line in due time. If it fails to rise above it, that could lend credibility to the possibility of further stock market losses thereafter. But let’s not get ahead of ourselves. We don’t want to focus on the wrong hand, so we must look at what market behavior is suggesting now, in the short-term. I believe the market behavior always tells us the story, but we must exercise patience, be open-minded to all possibilities, and most of all, ignore media headlines.

 

STOCK MARKET, WATCHING FOR THE SUMMIT:

Chart courtesy of StockCharts.com

 

The S&P finished the month of March 1.7% below the Blue Line, compared to being 4.4% above the Blue Line at the end of February. I am currently wrapping up the seven-part article series I referenced in my last update. However, with summer rapidly approaching, and people tune out over the summer, I will likely delay their posting until early September. I believe the content revealed in these articles will be more valuable than what I disclosed in my book, Protecting The Pig.

Jeff Link

 

Disclaimers:

The BLUE LINE INVESTING® (BLI) investment process was founded on over 95 years of stock market history. It seeks to identify and align investment decisions with multiyear trends. Various aspects of this process have been illustrated in my book Protecting The Pig: How Stock Market Trends Reveal the Way to Grow and Preserve Your Wealth.

 

The S&P 500 Index is one of the most commonly followed equity indices, and many consider it one of the best representations of the U.S. stock market, and a bellwether for the U.S. economy. It is comprised of 500 large companies having common stock listed on the NYSE or NASDAQ. The volatility (beta) of the account may be greater or less than the index. It is not possible to invest directly in this index.

 

Technical analysis is a method of evaluating securities by analyzing statistics generated by market activity, such as past prices and volumes. Technical analysis attempts to predict a future stock price or direction based on market trends. The assumption is that the market follows discernible patterns and if these patterns can be identified then a prediction can be made. The risk is that markets may not always follow patterns. There are certain limitations to technical analysis research, such as the calculation results being impacted by changes in security price during periods of market volatility. Technical analysis is one of many indicators that may be used to analyze market data for investing purposes and should not be considered a guaranteed prediction of market activity. The opinions expressed are those of BLI. The opinions referenced are as of the date of publication and are subject to change without notice. BLI reserves the right to modify its current investment strategies based on changing market dynamics or client needs.

 

Past performance is not indicative of future results. This material is not financial advice or an offer to sell any product. The information contained herein should not be considered a recommendation to purchase or sell any particular security. Forward-looking statements cannot be guaranteed.

 

Guardian Wealth Advisors, LLC (“GWA”) is an investment adviser registered with the U.S. Securities and Exchange Commission. Registration does not imply a certain level of skill or training. More information about GWA’s investment advisory services can be found in its Form CRS or Form ADV Part 2, which is available upon request.

 

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