I know this market is testing the patience of most investors. In many cases, I suspect that the test is a failure. People are definitely panicking and in quite a few stocks, it appears that all patience is gone. I am not immune to having my patience challenged. In life, I try to be as calm and understanding as possible. Sometimes, I don’t do as well as I would like. But when it comes to the markets, I rarely lose my patience. That remains the case despite all the terrible market action you see if you only focus on the indices or the stocks that hit the headlines. As you can see from this week’s signals, I almost gave as many new UP signals (69) as new DOWNs (101) and the total of 170 signal changes is a lot less than I expected when considering the Friday closing action.

Last year at this time, I remember changing a bunch of stocks to DOWN every week despite the market’s love affair with buybacks, Private Equity, etc. etc. People would tell me, “you don’t get it”… “you don’t know what you are doing”…”you should be less negative”…”if you want to be a success in this business you need to tell people what they want to hear.” Every week, I’d laugh and take my lumps with a heavily downward bias as the market kept heading higher. Some times it was annoying but I never lost my patience and when February 07 whacked the market, I felt some vindication. Then we rallied to record highs again and the same disbelief set in. Following July, the rest of the year was quite good for a patient permabear like me.

So what the hell is going on with me since December 10th? Don’t I get it? Do I know what I am doing? Shouldn’t I be more negative? Maybe so. In an odd way, it’s almost comforting to hear the same criticisms in reverse this time. But each week, I look at each of the 3500 stocks and try to remain objective. Obviously, it’s important to always consider market pressures, but even after doing that - I am still not seeing such a negative outlook. Yes, I am bearish long term. The economy is weakening, the financial sector is a mess, the consumer is struggling, earnings season will probably suck, but something is causing me to remain patient. If this week closes like the past two, it looks like the HEDGEfolios Timing Indicator will be pushing back into bearish territory. But until then I am hovering slightly above the 50/50 line and I am comfortable right where I am.