Don't fight the market · Invest & Retire Community

Don't fight the market

Despite JD Vance fails to secure a deal with Iran, US is now trying to close the Strait together with Iran (instead of opening it) - the market is going up.

Here's the thing most investors don't understand

Don't fight the market

Even though I personally disagree with the Iran situation from being far from over, oil price spiking back up to $104+, this means my logical brain says the market should go down

However, the momentum has already reached a bullish area and we are now in a V shape recovery (instead of my initial forecast W shape recovery)

This is where the "logical and analysis" investor diverges from rule based investing

For rules based investing, we extract probabilities out of the market and trade when the market is in our favour. For example, the rules currently say we are in a bullish market

The logic investor would analyze the entire macro environment (e.g. me analyzing the war) and conclude that we are still bearish

Who should you follow?

The rules should be followed.

While it is tempting for me to say that we should continue to short the market or hedge as the Iran conflict is not resolved, the market is govern by big money which already bought at the dip.

So even if this correction is short lived, that's fine.

I will follow the momentum of the market combine with my analysis.

This allows me to stick with the market and be on the right side more often

Cheers,

Eric

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Eric Seto

Chartered Professional Accountant (CPA)

Chartered Investment Manager (CIM)

Founder of 5MinInvesting.com

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