I’ve said this before, and I’ll say it again, the S&P is behaving nearly identically to this period of time last year before the collapse.
Both had a rally into the new year that extended from the 4th quarter. Both sold in the last week of January to test a major support, the 50 day moving average, only to rally up the first week of February. Neither made significant new highs in the weeks following the bounce. Both started to see weakness in the back half of February.
The question is, will next week mark a hard sell, just like last year, that extends deep into March. Timing the selloff is tough but from what I am looking at, and as explained in some of my prior posts, links below, I think that there is a strong chance that we are looking at a 10-15% sell off this quarter.
FANG largely did not participate at the all time highs, the yield on 10 year treasuries is surging off of the lows, currently at 129 basis points, the yield on 30 year treasuries has broken 2%, crude oil just hit the same price as about this time last year at 62 bucks before reversing today, and to top it all off the dollar index continues to languish around 2018 lows of 90.56.
The importance of a crashing market within the first quarter of the Biden Administration is that it will immediately draw attention to all of his job crushing policies and provide easy attack vectors to further illuminate Democrat incompetence.
I would anticipate the usual fiscal and monetary remedies, but at this point it will only further compound the inflation that we are already seeing with food and energy prices and contribute to rising yields for recurring market crashes and the eventual big one over the next year or two.
Pay attention to the rising yield on the 10 year bond. It will be a major factor in crashing the market under Biden patriots.win/p/11SJtECEIz/pay-attention-to-the-rising-yiel/
Biden Economic Collapse Watch – Signs of a topping market -NASDAQ hits all time highs without FANG stocks patriots.win/p/12hR2tWWsi/biden-economic-collapse-watch–s/
Biden Economic Collapse Watch – The S&P is looking a lot like it did last year right before the crash patriots.win/p/12hR7UVnbt/
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.