This is a Warren Buffett Market

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buffett-250The day after the Trump election victory, articles came out on describing how much Buffett made – some $11B, according to this CNBC article published on November 22, 2016.

Thought that was a lot and that it might’ve been too late to buy then?

Well, wait til you hear about how much Buffett made after this past week’s rally. Just look at the size of that December rally compared with the election rally in November in the chart below.

If Buffett made $11 billion by November 22, he’s probably up $30 billion by now – assuming proportional gains and that he held on to everything.

The rally in December so far is monstrous in comparison with the days shortly after the Nov 8-9 election results

You see, today’s market is the kind of market environment where buy and hold will pretty much outperform any kind of investment strategy and this is the investment strategy that Buffett recommends to everyday people. 

This prediction that the first green candle in November would potentially start a long rally — was quite prescient as we are now above 2255 ES.

Our prediction back in early November was quite prescient — highlight the beginning portions of major rallies – on that first big green candle. Indeed, if you compare the below chart with the above chart, you’ll see that the rally did indeed follow through — even with the election results still unknown at that time.

You can follow Buffett’s strategy simply by buying VOO or SPY. Or, of course, you can go directly to Vanguard and open an account with them to dollar cost average.

But the hardest thing, especially for traders, is to hold on.

Easier said than done.

Based on our analysis of the S&P500  at LifeStyle Trading 101, the market should consolidate in this 2230-2270 region, but will ultimately resolve to the upside with the potential of reaching over 2300 before end of the year.