E Market Briefing For Thursday, May 13

A typical trendy haircut - is a 'fade', but it is not the same as a 'close shave'. In a sense that's a debate in this market, especially for the S&P and Nasdaq because of the leverage; because of the compelled selling in a number of the so-called hot stocks in the pandemic (that are now down as much as 50% and that is a wipe-out or worse for some hedge funds; especially leveraged play).

So as rates move up; inflation increasingly is viewed as 'other than transitory', (except for comments from some of the Fed speakers you may have heard in today's excerpts of their comments) even 'if' wages and costs do eventually it seems encounter a sharp pullback from current levitation; it's another scene.

It's all coming in April and May; though as forewarned in January, even before a totally unexpected hospital 'adventure', seasonal money would be limited in the weeks after 'contributions' (IRA and so on); and only the 'game' aspect so instilled in this era's traders would extend the move. Some stock vulnerability was suspected likely after early February; and indeed a look at Covid-plays in fact suggests many of them topped on a rotating basis starting back then.

We counted on 'rotation' to provide 'distribution under cover of a firm S&P' to sustain illusions of strength in the Index, really for a couple months at least, and that's what we were fortunate enough to see. Not very exciting as I noted a few times; but it was correct as to what we got. Momentum-type investing is (or at least was) a 'chasing of performance' late in the game; rather than when it was a 'real' bargain back at our low in March of 2020.

Executive summary:

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William K. 1 month ago Member's comment

An interesting analysis.

Gene Inger 1 month ago Author's comment

Please visit www.ingerletter.com and subscribe to our Daily Briefing. If you do so this week and mention TalkMarket in feedback to me, and I'll 'comp' the intraday MarketCasts to you at no extra charge. I have provided much of my work here for far too long; even though without videos (voice over charts.. technical analysis primarily). To continue doing so we need to see a response from readers here; which is why I will reward personal feedback so I know you read this post. I'm pretty much back to full speed; after (miraculously) surviving Covid and a more than two months hospital stay. (How I did so and how I have my strength somewhat back remains a mystery to me.)