The SP500 moved from the bottom of the price channel to the top within the day on 13 April. The price channel is declining so today’s move up means little so far.
At first I was half joking, then I decided it was the only way, but I never expected the Fed would come to the same conclusion.
Our latest Market Risk E-mail is posted under our Market Commentary section for all subscribers today. Also, I’ve provide a short summary on our projections for different investments under our Current Allocations page.
The SP500 holds 80% by value of the total US stock market. It holds 45% of the developed world’s stock value. It is the leading index to watch and analyze for understanding the larger moves of the global stock market.
If interest rates today matched inflation the 10-year would already be 8% which in turn would collapse valuations back to 10x earnings… so the stock market would be 65% lower today relative to earnings.
We are already, she said, in the middle of a third World War, whether we’ve fully grasped it or not.
The SP500 needs to hold 4300. There is little support below this level.
Market internals moved from bad to ugly this week. There was little bounce after Options Week ended. Then the Federal Reserve basically confirmed that they are not there to prop up the stock market for now.
Do not try to catch falling knives.