I believe that the major markets have entered a long consolidation period during which companies must perform to their expectations for several quarters, at least until individual investors have their retirement portfolios stuffed full of stocks bought with cheap dollars at prices far below here. When the positions have been rolled into Joe Sixpack's port, the money will be redeployed toward funding the economy in a way that will lead to growth. (IPO capital, secondaries, and debt) The resulting growth will be the fuel that takes the broad markets higher. Until then, I continue to avoid momo pigs, particularly retail and super regional banks, and actively quest for hardly researched value propositions.
The China macro environment has made some of the prospective China growth stocks even more valuable and the profitability of a trade rests on meeting self-guided expectations. Some companies may be held back because these expectations seem too high to be credible and performing presents big opportunity.
For now, I am focusing on trading ranges with a list of catalysts regularly updated, and holding fast to my prospective stocks, as the desire for alpha invariably leads to rarely mentioned, quality issues.
