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High P/E Adjusting
The S&P 500 Index failed to hold above the important 200-day Moving Average last week reflecting continued selling of high P/E stocks although energy and materials sectors held up.
Quarter Or Half?
While markets generally accept rates will rise they don't agree if it will be a 25 or 50 basis point hike.
Correction Inspection
Last week just as the S&P 500 Index reversed from the January 24 low, it ended just as suddenly and headed back down to end slightly above support from the 200-day Moving Average.
Reversal Or Continuation?
While the bulls wonder if last week's reversal can be sustained the bears prepare for another leg down.
Growling Bears
The bears came alive last week and let everyone know they are in charge for now.
Interest Rate Deja Vu
Crude oil prices continued higher on lower inventory levels, but declining futures open interest suggest less enthusiasm.
Delighted Bulls
Volatility and market breadth indicators confirm the changed market sentiment, although volume was less than usual for the last two weeks. For now, the bulls have it.
Omicron Strikes Again
Just when it seemed like the Covid Omicron variant might not cause more shutdowns the week before, last week the fear returned along with actual shut down announcements.
Omicron Worries Fade
Last Monday the S&P 500 Index, once again supported at the 50-day Moving Average, offered the first glimmer of hope for the end of the Omicron pullback, then confirmed on Tuesday with a gap up at the open.
P/E Multiple Compression
Popular overhyped growth stock favorites began the inevitable journey down to more reasonable valuation levels as markets began factoring in reduced liquidity and higher interest rates.
Something Unexpected
Although the S&P 500 Index began flashing caution signals two weeks ago, Friday's Covid Omicron variant news rightfully deserves the "Something Unexpected" designation.
WTI Crude Oil Seasonal
Although crude oil prices seasonally decline this time of the year, further declines will imply slower global GDP growth along with increased market risk.
VIX Correlation Indicator V2
Last Wednesday's CPI report renewed concerns that interest rates may increase sooner than previously anticipated. An unusual double-positive by the VIX Correlation Indicator warned of trouble.
Smooth Sailing
A review of the VIX Correlation Indicator and a brief update for WTI Crude Oil.
VIX Correlation Warning
After last week's gains, the VIX Correlation Indicator gave a warning signal as it turned positive.
Downward Sloping Channel
Unlike the long accumulation channel from the March 2020 low the current operative technical pattern for S&P 500 Index looks like a downward sloping channel – call it a distribution channel.
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