Cycle Trading

[Duma]

I have started watching Charles Payne of late and I like his discussions. Today's topic was how far does the market go down from here. Everybody but one Fed guy said we were going into a recession for sure.

He posted this statistic that I had never see before. He made the distinction between bear markets (-20% down) that happen with no recession and those that did go into recession. So if we are not going into a recession the average pullback is -22% and we are close to the bottom. If you believe that we are going into a recession, we got some more to good.

In my mind there is no way we don't go into a recession (and I believe a hard recession) with inflation as high as it is along. I won't even talk about all the bad things going on.

Normally small caps are a good buy when coming out of a recession. I think I may bet of Wood's ARKK this time around. There has been so much damage here it is hard to believe. From the highest close on Feb 16th to today, down -72.6%. ARKK will need a 264% gain to get back to the high. I like that.