What you 'know'

It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so. - Mark Twain

They say it's bullish when advance decline lines lead markets to new highs.  Well...that's not always the case.  At least not for the S&P 500 in the most recent fall rally.

Cleaning up some chart lists I came across this chart of the S&P 500 Advance-Decline line from November.

Clearly if you would've invested off that chart alone, you have been buried in 2016.  So what are the lessons here?

1. We know less than we think about markets
2. Each data point is just a piece of evidence within the market mosaic. 
3. There are always exceptions to the rules

Amazingly, this signal is not invalid as the market hasn't broken the fall lows, but you're year would still be wrecked within two trading weeks if you confidently waited on the market to make new highs.

Thanks for reading!  Trade 'em well!