Just wondering what everything is thinking. Thoughts?
Fundamentals seem to point to a bear trap:
1.) Very inverted 10/2 treasury curve which always has historically proceeded recessions.
2.) Corporate forward guidance on future earnings *mostly* doesn't seem too great from recent earnings reports.
3.) Interest rates are high and going marginally higher per Powell. 4.5% seems pretty high with the debt we have incurred since 08.
4.) Fed is still running their QT operation in the background (nobody talks about this).
5.) CAPE PE at 30 still seems to indicate high valuations. New mean value (post 1990) seems to be around 25.
6.) Just had to throw this in (jokingly) - Cramer is calling this a new bull market. Bearish to me.
Other factors point towards new bull market, soft landing, etc:
1.) Technicals are firming up - i.e. 50/200 S&P "golden cross".
2.) Powell's lack of "hawkish" statements seem to be priming things for a later year pivot. He seems to do this in phases, sort of like how he gradually changed course when raising rates.
3.) YOY inflation indicators are precipitously falling - but with the ridiculous levels in 2022, this was a given.
4.) Voodoo market indicators - January was great, so goes the rest of the year, never 2 down years in a row, fill in the blank, etc. etc.
Fundamentals seem to point to a bear trap:
1.) Very inverted 10/2 treasury curve which always has historically proceeded recessions.
2.) Corporate forward guidance on future earnings *mostly* doesn't seem too great from recent earnings reports.
3.) Interest rates are high and going marginally higher per Powell. 4.5% seems pretty high with the debt we have incurred since 08.
4.) Fed is still running their QT operation in the background (nobody talks about this).
5.) CAPE PE at 30 still seems to indicate high valuations. New mean value (post 1990) seems to be around 25.
6.) Just had to throw this in (jokingly) - Cramer is calling this a new bull market. Bearish to me.
Other factors point towards new bull market, soft landing, etc:
1.) Technicals are firming up - i.e. 50/200 S&P "golden cross".
2.) Powell's lack of "hawkish" statements seem to be priming things for a later year pivot. He seems to do this in phases, sort of like how he gradually changed course when raising rates.
3.) YOY inflation indicators are precipitously falling - but with the ridiculous levels in 2022, this was a given.
4.) Voodoo market indicators - January was great, so goes the rest of the year, never 2 down years in a row, fill in the blank, etc. etc.
