E Market Briefing For Monday, Dec. 7

It's not yet a 'breaking point' for the S&P though one looms; short-term at least. S&P can indeed stay overbought for quite a long time; and a shakeout does not mean an actual 'trend reversal', despite protestations from a bearish contentious crowd of technicians and analysts calling 'doom' for months.

(I've tried to again describe some of my thinking about markets; and I think it might be useful not just to newbies in the market, but experienced players trying to 'force' a move. They continue to 'fight the Fed', and to fight the post-Covid enthusiasm which I hope doesn't turnout to be the problem next year; if vaccines aren't so good. I realize that could be a bigger opportunity for stocks like Sorrento of course, but overall for the Nation and humanity, I'd like to see the vaccines work well.)

Concurrently the positivity of Covid-19 has indeed impacted the entire Nation; and for that matter much of the globe, except where they were very strict, like China for instance. This kind of struggling 'with' positivity; all along creates the backdrop for a fragile economy over these few months; prior to broad vaccine distribution; and a reminder even that takes weeks to build immunity.

Also ... Ed Bastian, CEO of Delta Airlines send out a memo Saturday morning I have heard about, saying they are bringing costs under control; and cut cash drain by about 50% in the most recent Quarter versus the previous. He further states they 'hope' to be at breakeven cash-flow by late Spring of 2021.

Conclusion: risk-mitigation may be appropriate these last few weeks of 2020 given concerns about another draw-down in stocks, or at least the super-cap primary leaders being pushed to records.

There are even unique cross-currents that cause sector-shifts and tax change concerns; that can make the usual late-year considerations topsy-turvey. Sure we want to be wary and try to pick-out levels; hence the 3800 S&P goal; and I noted as long as S&P is above 3500, and now elevated that to 3600 and may be 3650 early next week (barring exogenous weekend shocks).. as long as it trades above some levels it's noise/swings withing the grinding trend. But with the right news (as Thursday gave a preview) the pattern can shift swiftly.

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