The time of maximum pessimism is the best time to buy and the time of maximum optimism the best time to sell – John Templeton Powell and The Fed surprised the market Wednesday by changing their tune. Instead of their preoccupation with inflation, they pivoted to an equal concern with their other mandate: full employment…
While the Fed is done hiking rates for this cycle, my concern last weekend was that Powell may still try to talk “higher for longer” in his press conference on Wednesday due to the strong recent moves in financial markets. But that may depend on the November CPI report due out Tuesday at 8:30am EST….
I have written a lot about how the Magnificent 7 are holding up the market cap weighted indexes while beneath the surface many smaller stocks have broken down (“The Market Is About To Break”, October 3). My point has been that it’s only a matter of time before the Magnificent 7 themselves break down, bringing…
Stocks ripped higher last week – with the S&P and NASDAQ each gaining about 6% – after the Fed meeting Wednesday as investors concluded that the Fed is done hiking rates for this cycle. You can see this in the chart above in the change in the forecast of the likelihood of the Fed hiking…
Last week was an important week as the market cap weighted S&P and NASDAQ both broke below their 200 DMAs. It was something I’d been expecting given the underlying internal weakness in the market for quite some time now (“The Market Is About To Break”, October 3). What it means is that the bear market…
Any weakness in [Big Tech’s earnings reports] could be the catalyst for the market weight S&P to decisively break below its 200 DMA which I’ve been forecasting for three weeks now – “Market Technicals Heading Into Big Tech Earnings”, Top Gun Financial, Monday 10/23 Three weeks ago I pointed out the internal weakness in the…
On August 24, I argued in “The Bear Market Rally Is Over” that the outperformance of The Magnificent 7 was masking weak overall market internals and that the bear market was over. About a month later on September 20, the Fed did its “hawkish pause” when it paused its interest rate hiking campaign but implied…
September was a tough month for stocks with the S&P down 4.87% and the NASDAQ 5.81%. In fact, the S&P is currently sitting only 2% above its 200 DMA. The 200 DMA is the most important indicator in technical analysis. Securities trading above an up trending 200 DMA are thought to be in a bull…
In the wake of the Fed’s “hawkish pause” Wednesday, in which they paused their interest rate hiking campaign but said they may still hike one more time this year and increased their forecast for the Fed Funds rate at the end of next year, interest rates across the all durations broke out as the market…
Inflation is yesterday’s news. The Fed had already crushed it with all its rate hikes and the failure of Silicon Valley Bank and its collateral damage are ushering in deflation. While the Fed Futures are split on if the Fed will hike 25 basis points or not at all next Wednesday (March 22), their rate…