[lewdog]

Also, I don't think most understand the magnitude of the gains we've seen. A nearly 90% rally since March 2020 lows. That just doesn't happen. The average return over time is 10% in the S&P.

And we aren't even seeing average decline in the S&P during bull market pullbacks while still following a bullish trend.

The U.S. stock market is making it out of the coronavirus crisis, and the S&P 500 and Nasdaq are hitting record highs. Now what?

But after a monumental rebound from the March 2020 lows, the stock market went into a necessary consolidation. From its March 2020 low, the Nasdaq soared nearly 114% to a peak on Feb. 16. The composite then fell into a funk, pulling back as much as 13% before regaining the momentum that carried the index to record highs the past week.

"After a nearly 90% rally off the March 2020 lows, it's not much of a surprise that since mid-April the S&P 500 index has been choppy and generally moved sideways," Jeff Buchbinder, equity strategist at LPL Financial

Before 2020, the Nasdaq had four years of gains greater than 40% since its 1972 debut, according to Investor's Business Daily research. The best year after such a surge was the 16.9% advance in 2010, when the market was still recovering from the 2008 financial crisis. The worst annual performance after a 40%-plus gain was in 2000, when the dot-com bubble burst and the Nasdaq collapsed 39.3%.

Worth noting: The average maximum decline in the S&P 500 at any point in the second year of its bull markets was about 10%, Buchbinder wrote. This year, support at the 50-day moving average has kept S&P 500 pullbacks to no worse than 6%.

The market's flattening wouldn't be much of a problem for growth stock investors if enough stocks were rallying from breakouts. But gains have been possible only through great stock picking.

For many investors, even a 10% portfolio return has been difficult to achieve in 2021. Heavy churn in market leadership makes it harder for stocks to sustain runs and reach normal 20% to 25% gains from buy points.

Reflecting that frustration, most IBD stock lists are lagging the S&P 500 this year. Through Friday, the IBD 50 was up 9.7%, the Big Cap 20 9.5% and Sector Leaders 13.7%, the latter essentially matching the S&P 500.

Some analysts say this year's stock market has seen more sector rotation than usual.

Technically, the best stocks also distinguish themselves with sound base patterns The problem is that so many stock breakouts from proper buy points on a technical basis haven't been as productive this year as they normally would be. Taking profits at 10%, rather than the normal 20% to 25%, may be a useful strategy. (Holy shit, Lewdog has been preaching this in here!).

https://www.investors.com/news/stock...for-investors/