Long In The Tooth...

The bull market in the US on Wednesday of last week became the longest on record, turning 3,453 days old. But is it really the longest? From Bloomberg: The Longest Market Rally in History? Take a Closer Look...

According to a loose consensus, bull markets are rallies that go beyond 20 percent and are never interrupted by a 20 percent fall.

Here’s the issue: the definitions aren’t chiseled in stone. They’re not laws of nature -- it’s not even totally clear where they come from. The 20 percent threshold strikes people as arbitrary, spurious, an invention. Pundits disagree on everything from the role of psychology in defining market eras to how strict you should be about the parameters for past ones.

This bull run sure is "long in the tooth". I've heard this phrase many times the last few years and I'm sure I've used it on occasion myself. A strange phenomena that sometimes exists in human psychology, is that if something continues longer than most think it should, it means it could end very soon.

On the flip side when I was observing the cryptocurrency/Bitcoin bull market last fall into January of this year, I heard very few people talking about it being "long in the tooth". Instead it was only projections of how high Bitcoin would go. $50K, $100K and even $1M were being thrown around with ease and surprisingly not that much skepticism. We all know how that ended. 

Personally I haven't heard many ultra bullish targets being thrown around with regards to stocks. Yet. Maybe this will happen soon. Or maybe stocks keep grinding higher for many more months or years without a bear market? 

Who knows. Who cares. Stocks are going up so you should be long. But long with a plan, which means understanding what you own, why you own it, and what you will do when the trend and momentum begin to stall. 

This historic bull market still has a healthy amount of skeptics. This could mean that there's still plenty of gas left in the tank. And who knows, maybe the gas remaining is enough to send stock prices into high gear. 


Below are five of the stronger trending stocks on my CM50 (Canadian MegaTrends) & UM50 (US MegaTrends) lists. 

Cannabis, cannabis, and more cannabis. Pot stocks continue to be on fire in both Canada and the US. This is nothing new for Canadian investors but Americans have caught the fever lately with US listings Canopy Growth (NYSE) and Tilray (NASDAQ) seeing a large increase in volume and price appreciation.

Remember that chasing stocks higher is not recommended and even the strongest trending stocks can experience significant drawdowns. 

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Have a great day and thanks for reading!

Greg Rieben