Powell Pivots! The Issachar Fund remains fully invested in growth stocks, expecting the bull market to continue into 2024! Fed President Jay Powell pivoted (changed) from raising to lowering rates on Wednesday, and the market rallied higher. The yield curve has been inverted (short rates > longer rates) for several months, predicting a recession next year and forcing Powell to change course. Leading stock chart patterns will reveal what the “smart (big) money” is anticipating before it becomes the “news,” which is why I follow the money/charts. Institutional money (above-average volume price moves) has been flowing into leading stocks since the November bottom after the market believed the Fed would soon pivot. The Fed has been fighting inflation it created by raising rates over the last two years. Rate increases do not bode well for a healthy stock or bond market. It is not wise to “fight the Fed.” However, the Fed is now transitioning from higher to lower rates, a favorable environment for stocks and bonds. I believe growth stocks could do very well in the anticipated slower growth inflationary (stagflation) environment in 2024. Growth stocks with accelerating earnings and sales continue to hold their breakouts, which is a sign of a healthy bull market. (There is no guarantee that any investment will achieve its objectives, generate positive returns, or avoid losses.)
The S&P 500 and NASDAQ 100 indexes consolidated resistance gains and have broken out to the upside! This bullish action gives me the conviction to stay fully invested, expecting the rally to continue higher. The $34 trillion debt and deficits are still a huge problem the market will be forced to address, but they are “kicking the can down the road” for now. Debt is not an issue until it is, and it will be too late for investors who choose to ignore risk instead of managing it. I firmly believe risk (losing money) must be respected and actively managed to avoid life-changing losses. A life-altering loss at my age (60) is not acceptable.
Retail sales came in better than expected, and the market cheered! However, people are not buying more stuff; they are paying higher prices for the same things because of inflation. Ever since we came off the gold standard in 1971, the dollar’s value (purchasing power) has continued to decline, meaning it costs more to buy the same stuff. The dollar is in a downtrend relative to other currencies because the Fed is projecting lower rates. The higher relative rate currencies tend to attract more foreign capital seeking higher yields.
Bottom line: We are fully invested and content with the market’s gains! My strategy has been out of favor since February of 2021 in a higher interest rate environment, but the rate “winds” have changed, rewarding growth stock picking. The market “winds” decide the return, so we focus on controlling the risk we take commensurate with the expected return. The Fed is done fighting inflation they created (by printing money) during COVID-19 and has embarked on a lower rate “soft landing” posture going into 2024. Lower rates are a huge positive catalyst fueling this new bull market. It is not too late to join the party. Grace and Peace and Merry Christmas!
May the God of hope fill you with all joy and peace in faith so that you overflow with hope by the power of the Holy Spirit. Romans 15:13
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., a member of 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 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. 3617-NLD-12/17/2023