Market Update: 09-10-18

The Issachar Fund (LIONX) is 35% Long Equities and 65% Cash as of Friday, September 7, 2018. LIONX holds 26 Stocks in leading industries with CAN SLIM fundamentals and chart patterns. I am patiently looking to buy more CAN SLIM stocks as opportunities present themselves. Technology stocks came under some recent heavy selling which pulled LIONX down a bit, so I sold a few winners and losers to balance the risk/reward potential. My bias is that technology will bounce off support and resume higher. Maybe we just needed to digest some recent parabolic gains that may have gone too far too fast.

The S&P 500 Index recently broke above the January high resistance area at 2872 and now has filled the “gap up” as it slipped back to the high (on lower volume) which currently serves as the next logical support. This is very constructive, in my opinion. September is traditionally a weak month, but I believe the market will respond favorably if the China skirmish ends, or the market anticipates that the Republicans will dominate in the November elections. My gut says the market will hold support and work higher. If we do not find support near the 2872 area, then I suspect the S&P 500 Index will likely drift lower to test the next level of support at the 50-day moving average near 2827 (1.6% lower).

Non-farm payrolls increased by 201,000 jobs in August and the unemployment rate remained at 3.9%. The average hourly earnings were up 0.4% m/m, doubling projections of a 0.2% gain. Year/Year, wage gains were 2.9% higher which is the highest since mid-2009. Weekly initial jobless claims fell by 10,000 to 203,000 which is the lowest since 1969. I believe this is mainly due to the Trump policies and not something that started under Obama.

Bottom Line: I remain optimistic that the market will hold support and bounce higher. If I am wrong, I am prepared to sell down to an acceptable level of risk. I believe Risk Management is the key to successful long-term wealth accumulation and retention. The market takes no prisoners. If you do not respect risk, it may will rip you apart.

Remember: Your Best-Interest is Also My Best-Interest!

(Portfolio holdings are subject to change at any time and should not be considered investment advice. There is no guarantee that any investment will achieve its objectives, generate positive returns or avoid losses.)

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Dexter Lyons