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Risk Onff

Futures are soaring after the weekend. Presumably it’s over optimism for some type of vaccine to Covid-19. It illustrates the broader problem with trying to call this market: it’s emotional as hell and we have little more than hope to inform our analysis.

The indexes themselves present a challenge. As the economy continues to stratify the winners and losers, the winners are eclipsing everything else in the major indexes. The top 10 stocks of the S&P 500 are now more than 25% of the index’s weighting. That can mask a lot of underlying damage.

It’s the underlying damage that’s being ignored by this market. Stocks continue to climb on the optimism of an infinity background from the Fed. This infinity backstop has flattened yields and anesthetized risk takers. In effect, we’ve fueled massive oligopolies that are squeezing out everyone else.

The Covid response has pushed national unemployment to records in record time. What’s unclear is how many of these workers will find their way back to work. At this point, parts of economy have been functionally killed off… as in… not coming back. Many small businesses are — or will shortly — go under. Many governors have made outlandish statements like “our economy will not fully re-open until there is a vaccine.”

This is serious stuff.

The economic impact of cutting much of the service sector by 50% is definitely not priced into the stock market. The problem is, as many are now pointing out, the stock market is not the economy. This is perhaps more true than ever when we look at the mega-super-giant-cap companies and how much cap-weighting-real-estate they occupy in our economy. What’s become obvious is the wealth divide in the United States is not just among individuals – it is among companies as well.

If small businesses fail to rebound, expect unemployment to remain high. This puts both the Fed and Washington in a difficult position. Keep rates low forever and print money to provide universal basic income? It can be done, but it means huge portions of the economy must be reinvented. Which, again, can be done… but how, then, does the stock market not get impacted?

The answer seems to be the same thing we felt back in the Greek economic crisis… kick the can down the road. Just do it, stabilize things now, and trust that someone else will solve the future problems – today has problems of its own.

So perhaps this is the new normal. Central banks everywhere will continue to print money. The money supply will increase, some will creep into the hands of consumers, but most will find its ways into the hands of the winner-take-all oligopolies.

Regulation will likely do little to stem this trend. All it will do is make it harder for competitors to grab market share. It will place the lobbied politicians in the difficult position of needing to break apart their largest campaign donors. (So you know it’s unlikely we’ll see any bucking this trend in the near future.)

So what is one to do?

We have the unenviable task of trying to predict the future while navigating the present. For now, stock markets, in defiance of technical trends or typical data, are showing signs of placing a bottom in place and building towards a pricing recovery. It’s almost as if this is the elected theme, so it must happen, regardless of data.

We’ve thrown unimaginable money at this economy. Money that didn’t even exist three months ago. That money fill find its way into the economy in unorthodox ways. But what is clear so far is it hasn’t found its way into the hands of many consumer. Stimulus checks? Sure… but that pales in comparison to the bond buying and SBA corporate bailout money.

When the dust finally settles, the economy will not look the same. Travel, dining, education, and entertainment are all going through a painful forced evolution. And all of those are significant parts of what drives the overall economy. There will be an impact. The question is, will we be able to see it in the stock market behind the eclipse of oligopolies?

So enough of the editorial. I include it because so many ask me what is different this time? Why does fundamental analysis seem to be ignored right now? And the answer is, it is ignored until it is not… the economy can mask a lot of damage, and hope can lead us to ignore many details. It will not last forever, but it persists for now. So how are we to invest?

Clearly, large-cap domestic blue chips have been the winners. And tech and health care have been the darlings. It remains to be seen if we are seeing bubbles build here. In some respects, tech has been fueled by a 1999-like frenzy that forced many to purchase new computers to move into the digital world of distanced employment. But does that refresh cycle come with the same 2-year dip in tech purchasing afterwards?

We know the SPX is no longer representative of the economy. It may still prove a useful proxy for the stock markets at large though. So, for now, we’ll continue to look to it for guidance.

This week the futures are already signaling a possible break-out from trend. The SPX has been in a sideways pattern for several weeks. The optimism around a vaccine may drive us through the 2945 resistance area. The next area if resistance is 2980 at the 100-day moving average.

If we continue the daily whip-saws we look for a pull-back towards 2850/2794 (which may as well be 2800). Emotion-driven markets aren’t all that sophisitcated in terms of support and resistance sometimes… so big round obvious numbers get a lot of attention. Look for the 100 and 200-day moving averages to be up-side resistance for this market, with 3000 being a significant optimism level. It will likely start as resistance, bouncing a time or two at this level before pushing through and rallying perhaps to new all-time highs… and here’s the crazy part… it may happen all this year… so yeah, in the next 6 months… (If I had to make odds, I’d go about 50/50 on this one… by no means a guarantee, but definitely a real possibility if optimism starts to swell… we put a lot of money into this economy… it’s bound to go somewhere seeking a return… and it doesn’t look like it’ll be the bond markets)

For the week, Tuesday and Thursday are the ‘danger’ days. We’ll hear from Jerome Powell on Tuesday, and we’ll get another jobs report on Thursday. Powell’s testimony is unlikely to move the needle. The only reason it’s a ‘danger’ day is if he paints a much darker picture than the market expects. So far, he’s already hinted that things are rough, and likely to stay rough. So markets aren’t expecting much.

Look for a trader’s market today. Already, futures are indicating a big push higher on Monday. There isn’t much ‘new’ news… well, there’s new optimism on a vaccine. But that’s not really new… that’s just the current story. We’ll see if this move holds, or if it’s another opportunity for traders to make a few quick bucks while the markets keep oscillating in a sideways pattern.

So risk Onff… the economy looks bad, but markets look good. The BigFoot macros are all negative, but the algo database has climbed to 55% long. Joblessness continues to increase, but we’re re-opening the economy… sort of… So yeah… everything makes sense… except for the stuff that doesn’t.

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by BigFoot), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from BigFoot. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. BigFoot is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the BigFoot’s current written disclosure statement discussing our advisory services and fees is available for review upon request.

I Don’t Get It, But That Doesn’t Matter

I’ll admit it: this market baffles me sometimes. Here we in the midst of an economic shut-down — unemployment has exploded; bankruptcies are popping up all over the place; profits are in the tank — yet this market charges higher.

Even the BigFoot Database has shown improvement as the number of total long positions has climbed over 33%. That’s up 50% from a week ago. So clearly there’s some momentum under this thing.

The question is, is the action healthy? Not if we look at earnings, which, according to JP Morgan are down over 47% on average for companies reporting.

It’s fine… markets are forward looking… the economy is about to turn back on and thing will go back to normal.

Yeah, right…

The economy might turn back on, but social distancing policies have become a real thing. And large parts of the economy will not be the same… especially restaurants and entertainment.

Also, markets failed to render a new intra-day high last week. Could be nothing — just trader activity — Or… could mean we’re running out of buyers and this is the price level for a while.

As discussed in prior blogs, we’re at a resistance point technically. Markets have drifted sideways for the last few weeks as the 2950-ish range but are yet to close above or ‘beak out’ from this level.

If this market were to follow a more typical pattern from here, we’d expect a pull back to at least 2800 or so (and more likely 2650ish). I use these vague levels because… frankly… this market is making up new rules as we go, fueled by mind-boggling Federal Reserve intervention and Government stimulus.

That rocket fuel has done a solid job stabilizing the bond markets and keeping hope in the economy. But… it’s been a while. And rocket fuel burns off. The Fed can keep buying bonds, but what happens next? How long can we pay people not to work?

Of course, these are rhetorical questions. But they do have a bearing on the stock market. For a season now, these markets have moved based on how the fight against Covid-19 has been going. That’s shifting though… reality is going to have to creep into this thing. And the big unknown is whether or not all this new debt of Uncle Sam’s will have any unintended consequences.

Meanwhile, we will deal with our moment-to-moment day-by-day analysis. And futures say the market should head lower… of course, it looked like they said this last week as well. What we ended up with is more of a sideways pattern.

The 200-day moving average has declined to close to 3000. If this market manages to close above this area by month end we could actually see a macro re-purchase signal. But this is a long ways off, and 3000 is currently much more of a resistance level than a support level.

Pricing patterns suggest a sideways-to-negative bias this week, with 2950 continuing as resistance, and 2873 as support. But like I said earlier, I don’t get it… this market has done with it sometimes does: prove the greatest possible number of people wrong at any given time.

My take – I still think this thing is over-baked and we’re trading on hope. And I think we can (and probably will) move lower in this trend. What I hear from a lot of folks is desperation – as if they missed the bottom and somehow missed their chance on this thing.

Maybe… But typically, right about the time you throw in the towel is when the market knows. At some point, data will matter again… then again, I don’t get this market (but that doesn’t matter)…

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by BigFoot), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from BigFoot. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. BigFoot is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the BigFoot’s current written disclosure statement discussing our advisory services and fees is available for review upon request.

May the Fourth Be With You

If bear markets are the Empire, this week the Empire may strike back. Based on weekend futures markets stocks are poised to drop Monday, with a strong indication of follow-through for the week.

Last week we hit a significant technical level as the S&P 500 pushed above 2950 intra-day last Wednesday. This, by most measures, fulfilled the 61.8% Fibonacci retracement many technicians were looking for.

While this is no guarantee, you may begin to see the tune change for some analysts as more people jump on the band wagon that this price move from the March 23 lows is a bear market rally. This may also be a shift in discussion from “V-shaped” recovery to some other alphabet (L, W, U… zig-zag, whatever).

The reality is that the economic impact of this thing is starting to set in. Some companies will survive but others will hurt. And when enough companies hurt, economic activity slows. That hurts the winners too in most cases. So even a big company like Amazon — a company that seemingly has the perfect business model and opportunity during this crisis — can still get punished by increased costs and fickle investors.

Looking ahead the crystal ball is murky. The technical outlook is not encouraging if the typical trend emerges. If we really are in a bear market, a resumption of the downtrend should resume, and we’ll decline for a season. The real question is whether or not we re-test the March 23 lows.

No one really knows the answer yet. If the virus turns out to be less deadly than hoped, we start to re-open the economy and things start spinning again. If it’s more deadly than hoped, we sit on our hands longer. The states that have opted to re-open will be case studies closely watched for a bit. Spike in cases and hospitalizations? Market probably gets nervous. No spike, market drifts sideways for a bit and finds its footing.

For this week, the primary support level looks to be 2683/2650. Given the pattern of fairly aggressive volatility, it would not be out of line to see a pull-back to this level. That’s about a 5-to-6.5% decline. Historically that seems like a big move for a week (and perhaps it will take a couple weeks to unfold), but that’s not out-of-line for the way this market has been moving recently.

Up-side resistance would be at the 2950/3000 levels again. That’s basically both the 100 and 200 day moving averages.

Other noteworthy stats we’re watching: all three of the BigFoot Macros are negative… so that’s a pretty ugly thing. The database climbed from about 21% long to 23% long — so, green shoot — but still, not enough to move the needle much. It’s still a very bearish percent-long at this point.

The other side-show we should keep watching is Washington. Are they going to come out with some sort of direct-to-consumer money dump? Some form of universal basic income (though they won’t call it that)? If so, that could be lighter fluid for this market. So… we’ll have to wait and see.

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by BigFoot), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from BigFoot. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. BigFoot is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the BigFoot’s current written disclosure statement discussing our advisory services and fees is available for review upon request.

Trade Winds Improving

Last week markets got a pop on ‘less bad’ trade news as China indicated a partial trade agreement may be on the table. This could mean additional planned tariffs would be suspended.

Markets viewed this as a positive and finished last week with a strong push higher.

While the news is good, the technical set-up for this week may have a quick down-draft to fill in a price gap for the SPX. There is technical support around 2930 or so — right at the 100-day moving average (the 50-dma is only 5 points higher).

Interestingly enough, the market is neither over-bought nor over-sold. It’s pretty much right in the middle of its 21-day trading range. So positive news from here could lead to a push higher (especially if the small price gap created last Friday gets filled quickly this week).

This is the first technical sign that the markets could be setting up for a break-out to the up side in a while. There is still a chance the sideways pattern could simply persist, but the price reversal last week was a good sign the 2900 is significant support for the SPX.

For this week, look for a quick dip down, followed by a potential surge to the up-side. Breaching 3000 on the SPX is possible this week, although it is unlikely the all-time highs will be reached. It would take a more definitive deal with China to spark that kind of move.

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by BigFoot), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from BigFoot. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. BigFoot is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the BigFoot’s current written disclosure statement discussing our advisory services and fees is available for review upon request.

Ready Q4

End of quarter rebalancing may generate some volatility today. Otherwise, markets look like they are staged to continue their sideways oscillation.

There is little technically to suggest there is a breakout in either direction. Instead, it seems the all-time highs of the SPX remain resistance, and the 100-day moving average remains as support.

The big-picture story appears little changed. The Fed is supporting the markets by maintaining low interest. Trade war headwinds are preventing the stock markets from climbing much higher. So we remain stuck in this sideways pattern.

Until something material changes, it appears there is little the market should expect in terms of a major move in either direction.

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by BigFoot), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from BigFoot. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. BigFoot is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the BigFoot’s current written disclosure statement discussing our advisory services and fees is available for review upon request.

Uncertainty is the New Certainty

Markets found some footing last week after a multi-week slide. However, futures are pointing to a drop yet again, presumably because of the most recent Trump Tweet regarding Iran.

So flip a coin. The SPX found a decent amount of support at the 2800 level. There also appears to be a decent amount of resistance around 2900. Not sure there’s a reason this market will break out of this range for the week. After bleeding off most of the year’s momentum in the past two weeks, we could be in for some sideways action while participants sort out the news.

For now, look for a sideways move for the week. A move of the SPX below 2800 — even intra-day — could be a sign of further downside on the horizon. There seems to be little catalyst (short of a formally inked trade deal with China) to push the market through any of the upward resistance right now.

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by BigFoot), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from BigFoot. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. BigFoot is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the BigFoot’s current written disclosure statement discussing our advisory services and fees is available for review upon request.

No Man’s Land

If you’re looking for some kind of directional indication from the short-term, the markets aren’t hearing it.

Since the Christmas Eve lows of last year, this market has been on a tear… until the last two weeks or so. Now it seems escape velocity is waning. Each time the SPX hits 2800 momentum seems to dry up.

After last week’s negative move the 200-day moving average is back on the menu. The question is, will it be support or resistance?

Given the earnings season is largely behind us, the markets now get to shift to economic reports and politics. But don’t be fooled – the real story remains the FOMC. As long as the cheap money remains in play, there’s little reason for investors to go elsewhere for returns.

Technical signals are pretty benign here. The upside momentum may be washing out, but there’s no significant downside to speak of yet either. This leaves us with a few key support levels in the short-term: 2742; 2722; and 2679.

To translate this into percentages, there’s about a 2.5% downside risk this week (according to technicals). There’s a similar amount of upside. Looks like we’re range-bound in the short-term until the market gets some news to confirm a directional break-out. So far, 2800 continues to be resistance.

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by BigFoot), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from BigFoot. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. BigFoot is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the BigFoot’s current written disclosure statement discussing our advisory services and fees is available for review upon request.



Waiting on Friday

Either the government stays open or it doesn’t. Markets will be keeping an eye on this. Not that the markets care about the closure all that much, but it’s a sign of whether or not Washington is going to be a headwind or tailwind.

Odds are we’ll see another shutdown. Markets may simply move in a sideways pattern until this gets resolved. As of this morning, futures are pointing to a slightly higher opening.

The VIX has dropped a bunch too, indicating the markets are not too worried about the well-forecasted shutdown. It appears the biggest issues on the markets remain a) the Fed, and b) really it’s still the Fed. The news outlets would have you believe it’s Chinese trade or jobs or something. But the Fed is the biggie. The rest of that is just data for how the Fed may respond.

Look for a sideways week going into a highly probable (read as about 95%) government shut-down 2.0. Once the rhetoric starts, we’ll see what happens from there.

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different
types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product
(including the investments and/or investment strategies recommended or undertaken by
BigFoot), or any non-investment related content, made reference to directly or indirectly
in this blog will be profitable, equal any corresponding indicated historical performance
level(s), be suitable for your portfolio or individual situation, or prove successful. Due
to various factors, including changing market conditions and/or applicable laws, the
content may no longer be reflective of current opinions or positions. Moreover, you
should not assume that any discussion or information contained in this blog serves as the
receipt of, or as a substitute for, personalized investment advice from BigFoot. To the
extent that a reader has any questions regarding the applicability of any specific issue
discussed above to his/her individual situation, he/she is encouraged to consult with the
professional advisor of his/her choosing. BigFoot is neither a law firm nor a certified
public accounting firm and no portion of the blog content should be construed as legal
or accounting advice. A copy of the BigFoot’s current written disclosure statement
discussing our advisory services and fees is available for review upon request.

Market Macro Fails

For the first time since 2016 the BigFoot Market Macro Signal has gone negative. And we’re already set up for a potential whipsaw, as futures are pointing to a higher open that would put the SPX above the threshhold to flip the Macro back into buy territory.

Over the weekend the big announcement was a temporary truce between the US and China. The details are a little fuzzy, but basically, no new tariffs, and some rollbacks on a few – at least for the next 90 days.

This doesn’t mean the trade war is over. But it is positive progress. So we should be good to go, right?

Woah, woah… slow your roll. Just because we have a deferral of action doesn’t mean everything is okay. And technically, things are still unclear. In fact, if the futures pop higher today as expected, there’s good chance a pricing gap will materialize.

We’ve spoken many times on conference calls about how the markets abhor pricing gaps. And in this case, unless the market managed to push above 2825 or so, it’s likely we’ll dip back down to 2760 some time this week first to fill that price gap.

From a Macro perspective, we just want to see the markets finish the year above 2754. This should be enough to flip the signal back to a buy. Which is interesting, because last Friday’s close would have done it. But, alas, that’s not how the signal works.

We’re in a bit of technical no man’s land. There markets have had a double-dip this year, but the fundamental news is pretty optimistic. Jay Powell and the Fed gave the market the gift it was looking for (a more dovish stance), and Trump has softened on the trade war. Pricing multiples have fallen to essentially their low-point for the year. So there’s room for the markets to go up, but the mixed pricing signals also mean there’s room for the markets to dip a bit yet.

Given we’re already into December, and most of the earnings for the year area already over, it’s difficult to see a rationale for why the markets should push to all-time highs before the end of the year. In fact, given the mixed Macro signal from the software – and the anemic 40% long positions ratio – it’s difficult to see much more than a sideways market from here – even with the ‘big news’ about the deferral of the trade war with China.

Make no mistake, Monday is shaping up to a be a positive day for the markets, with the SPX likely to push above 2800 intra-day. But Monday may not be enough to shake off the bear-market chatter just yet… Tis the season for miracles, sure. And perhaps Santa is bringing more than coal for the year. But it doesn’t look like yuge breakout to finish the year at this point.

Interestingly enough, the ‘bear market’ may have already silently happened in the form of asset rotation. Many of the high-flying tech names have already had over 20% corrections in pricing. We just haven’t seen the entire market dip simultaneously. A move like that may be reserved for our next recessionary environment. When that actually occurs is still a subject of much debate.

For the week – enjoy the reprieve. Just don’t let a few days in the market head-fake you into thinking everything is all clear. Plenty of up days happen in bear markets. Better to keep your cool and play this one by the numbers IMO.

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different
types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product
(including the investments and/or investment strategies recommended or undertaken by
BigFoot), or any non-investment related content, made reference to directly or indirectly
in this blog will be profitable, equal any corresponding indicated historical performance
level(s), be suitable for your portfolio or individual situation, or prove successful. Due
to various factors, including changing market conditions and/or applicable laws, the
content may no longer be reflective of current opinions or positions. Moreover, you
should not assume that any discussion or information contained in this blog serves as the
receipt of, or as a substitute for, personalized investment advice from BigFoot. To the
extent that a reader has any questions regarding the applicability of any specific issue
discussed above to his/her individual situation, he/she is encouraged to consult with the
professional advisor of his/her choosing. BigFoot is neither a law firm nor a certified
public accounting firm and no portion of the blog content should be construed as legal
or accounting advice. A copy of the BigFoot’s current written disclosure statement
discussing our advisory services and fees is available for review upon request.

Guess Week

Markets are yet to commit to anything from a technical perspective.  The SPX downtrend may extend toward 2532 (February’s SPX low), or it could rebound toward the 2800 resistance level.  That’s an election for you.  At this point, things are so tight we have little more than a guess to go on.

So for the week, hang on tight.  We could see anything.

Next week, we’ll get back to work.

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different
types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product
(including the investments and/or investment strategies recommended or undertaken by
BigFoot), or any non-investment related content, made reference to directly or indirectly
in this blog will be profitable, equal any corresponding indicated historical performance
level(s), be suitable for your portfolio or individual situation, or prove successful. Due
to various factors, including changing market conditions and/or applicable laws, the
content may no longer be reflective of current opinions or positions. Moreover, you
should not assume that any discussion or information contained in this blog serves as the
receipt of, or as a substitute for, personalized investment advice from BigFoot. To the
extent that a reader has any questions regarding the applicability of any specific issue
discussed above to his/her individual situation, he/she is encouraged to consult with the
professional advisor of his/her choosing. BigFoot is neither a law firm nor a certified
public accounting firm and no portion of the blog content should be construed as legal
or accounting advice. A copy of the BigFoot’s current written disclosure statement
discussing our advisory services and fees is available for review upon request.