A Lingering Appetite

To revisit a working thesis we discussed previously, the notion that the transition from Obama to Trump would automatically mean a much more bearish stance on the firearms plays seems to be quietly under heavy scrutiny by the market right now.

And rather than become redundant on the short-term rotation out of tech, it is all the more alluring to consider that if the two premier firearms plays, AOBC (formerly Smith & Wesson SWHC) and RGR, are now breaking out after multi-year consolidations it may be a good while before many people actually begin to believe in them given the change in tenor from the White House about the Second Amendment (not to mention to the composition of the Supreme Court).

As always, on this website and especially for Members we are not interested in taking political sides. 

But as market players we always want to stay opportunistic and gauge situations where prevailing sentiment may present a more viable setup than usual.

With this in mind, observing the long-term charts for both, below, the monthlies indicate that bulls are threatening to emerge from a tedious period late in the Obama years where the argument of inventory being too high and demand having been maxed out pressured the stocks.

But appetite may be lingering yet.