U.S. Markets close in 2 hrs 9 mins

Luck won't stop a correction


Today is Friday the 13th and last night we had glorious full moon. The confluence of Friday the 13th and a full moon is relatively rare. We won't see this mix again until 2049. The last time there was a confluence of a full moon and Friday the 13th was October 2000. On that day the Nasdaq (^IXIC) rose 7.8%; a vicious snap-back rally in an otherwise dire year for stocks.

I'm not superstitious but I do believe in what Keynes called the "animal spirits" and their ability to control markets. In the long-term prices are rational but the here and now is more complicated. For the better part of the last month stocks have been rallying for reasons largely rooted in sentiment. Too many skeptics bought into the idea of selling in May and going away. Because Mr. Market is cruel the stock market rallied 5%.

Obviously the mood has changed. The scenes coming out of Iraq are chilling. Yesterday the Bank of England's Mark Carney cautioned that central banks could be raising rates sooner than the market expects. Oil prices are screaming higher.

Based on the always-useful AAII.com survey of individual investors, this bad news is popping up just as sentiment becomes dangerously one-sided. At 44.7 the percentage of investors calling themselves "Bullish" hasn't been this high since the day after Christmas of last year.

I'm not superstituous and I don't believe in calling market tops. What I believe in fervently is that making money is a matter of managing your emotions. Right now the market is a bit too euphoric and there aren't a ton of reasons to buy either technically or fundamentally. This isn't advice but if you're given to over-trading your own portfolio and you tend to get emotional about money, today is as good a time as any to take some gains. If past is prelude taking some profits now could feel pretty "lucky" if and when the S&P 500 (^GSPC) pulls back to support between 1,900 and 1,850.

More from Breakout:

Why chaos in Iraq won't send oil prices surging - yet

Starbucks charges up retail - again

eBay’s got 99 problems and Amazon Payments' just one