I’m sure you’ve heard the popular saying…

“The trend is your friend.”

And also variations of it, like…

“The trend is your friend… until it ends.”

And my personal favorite…

“The trend is your friend… until it stabs you in the back!”

The idea here is simple: following along with your friend, the trend, is usually beneficial. But every once in a while, and without much warning, your “friend” will desert you.

That’s essentially what happened last August.

At the time, the S&P 500 had maintained a positive six-month trend for 184 consecutive weeks – between January 2012 and August 2015. That’s one heck of a loyal friend, that trend. And any bullish investor who followed the rising trend in stock prices did quite well.

But then in late August, over the course of just two weeks, the positive trend in stock prices vanished. It left bullish investors in the lurch, without their beloved “friend.”

The market’s sudden change of heart, last August, has had a lasting impact on investors.

Long-term buy-and-hold investors are still feeling the sting of love lost after being abandoned. Even short-term traders have been forced to readjust.

The sudden trend change was impactful because it triggered the No. 1 rule we live by: don’t fight the trend.

I’ll let you in on a bit of a secret…

In my trading service, Cycle 9 Alert, I monitor the six-month trend of any investment vehicle I’m considering.

If an investment’s six-month trend is positive… I’ll consider it for a potential bullish trade.

But if its six-month trend is negative… I WON’T consider it for bullish trades. (I’ll simply ignore it, or consider it for a bearish trade.)

Knowing this… I’m sure you can understand why I steered Cycle 9 subscribers into “defensive” plays last year.

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