The Issachar Fund is 100% in Cash! However, Investor’s Business Day (IBD) has declared Friday a Follow Through Day (FTD). IBD states that every bull market in the last 100 years has started with an FTD, but not every FTD has led to a bull market. An FTD is a 1% index gain on greater volume four days after a market bottom. IBD suggests that investors find stocks with proper setups to buy after an FTD. The last few FTDs failed, and this one is not giving me much conviction since there are not many stocks with proper setups to buy. The S&P 500 index rallied strongly into its 21-day moving average line of resistance, so I expect the market to give back some gains. We have had two down waves of S&P 500 index selling since January, and we are in the third and possibly final wave lower to shake out shorter-term investors. Bear markets typically experience three waves of selling before a new bull market begins. Inflation is still hot with little signs of a reprieve for gas and groceries, so I expect the market to roll over and finish the final wave. The last wave of a bear market is where we could see investors capitulate or sell at any price to stop the losses. Panic selling could be triggered by analysts lowering their earnings estimates for Q3. If I am right, we could be in a good position (Cash) to take advantage of what could be an incredible buying opportunity. Thanks for your trust and patience. (There is no guarantee that any investment will achieve its objectives, generate positive returns, or avoid losses.)
Last week, the Fed increased its balance sheet by $2 billion; it is still near its all-time high! If the Fed does what it says and starts selling bonds in July to decrease its balance sheet, I expect rates to rise and stocks to fall. Analysts’ revisions of earnings estimates lower, and a reduction of QE could be a recipe for a Q3 crash and Q4 rally. I would not be surprised to see the indexes drop another 10%. However, that could set the stage for an incredible buying opportunity for investors with mental and physical capital ready to act.
Bottom Line: No changes to our 100% money market position. I do not like sitting in Cash, but it is far better than losing money in this higher-risk market. The stage is set for another wave lower if earnings estimates get lowered and the Fed reduces QE. However, I take it one day at a time to assess the risk and act accordingly. Only God knows the future, so I rely on His Wisdom and the charts to discern where stock prices may be headed. I believe the future is brighter than the past as long as capitalism does not get replaced by socialism. Thanks for trusting me to manage your money like my very own. Grace & Peace to You!
For we live by faith, not by sight. 2 Corinthians 5:7
Investors should carefully consider the investment objectives, risks, charges, and expenses of the Issachar Fund. This and other important information about the Fund are contained in the Prospectus, obtained by calling 1-866-787-8355 or visiting IssacharFund.com. The Prospectus should be read carefully before investing. The Issachar Fund is distributed by Northern Lights Distributors, LLC., member FINRA/SIPC. Horizon Capital Management Inc. (HCM) is not affiliated with Northern Lights Distributors, LLC.
Important Risk Information: Mutual Funds involve risks, including the possible loss of principal. An investment in the Fund may not be appropriate for all investors. The Fund may hold cash positions when the Adviser feels that the market is not producing returns greater than the short-term cash investments in which the Fund may invest. There is a risk that the sections of the market in which the Fund invests will begin to rise or fall rapidly, and the Fund will not be able to sell stocks quickly enough to avoid losses or reinvest its cash positions into areas of the advancing market quickly enough to capture the initial returns of changing market conditions. The Adviser’s judgment about the attractiveness, value, and potential appreciation of particular asset classes and securities in which the Fund invests may prove incorrect and may not produce the desired results. Past performance is no guarantee of future results. Ratings are only one form of Fund performance and should not be used as the sole consideration in making an investment decision. Opinions expressed are subject to change, not guaranteed, and should not be considered investment advice. There is no assurance these opinions or forecasts will come to pass, and past performance is no assurance of future results. For more information regarding the fund, including current performance, please visit IssacharFund.com. Review Code: 5542-NLD-06/27/2022