钱神
2023-06-14

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@Ultrahisham：Euphoric exuberance all around The markets have been in a very buoyant mood lately. And calm despite the macroeconomics. That just makes me more cautious. Despite overbought levels and market worries as well as bearish sentiments, the market keeps driving up. Now, sentiments have turned bullish and many are saying the markets have entered a new bull market. Really? I beg to differ. In fact, the markets have all the hallmarks of a top. 1. Narrow breadth. Only 6 or 7 megacaps lead the market. This must be one of the thinnest 'bull market' ever! 2. The equal weight broad market market index is trending down. The divergence from the normal broad market index cannot be understated. 3. The market have never bottomed so way ahead of the Fed's final rate hike. And they may not be even done yet! I can keep going on. But I will just keep it at that for now. The reason I believe the market is grinding higher is not because the economy is turning up. Rather, there is stubborn growth. And the economists out there will know what I mean when I say that the headline inflation numbers are misleading. Those numbers are trending down coz of energy prices and food prices which have dropped quite a lot. Strip that out to give the core inflation numbers and you see a different picture. It is in the 4-5% and has been hovering there for a year. So for the FOMC to start injecting liquidity into the market will be a big joke. If they do that, they might cause a big rally in equities but cause havoc in the bond market and I am quite sure they are wary of that thanks to data from history. So stubborn growth it is. And that means stubborn inflation. So there is no leeway for liquidity to be injected into the system and without that it is hard to see a new sustainable bull market. The only way for inflation to be brought back in control is for a recession and historical data supports this. And I am quite sure the Fomc knows this too. So please do the maths. And the markets are not pricing in a recession at these headwind levels! So my trade is staying safe with cash. When nobody wants to buy is when I will want to buy. 😊 Disclaimer: Please kindly so your own due diligence as this is a sharing article and in no means financial advise. I am just sharing my opinions and thoughts. Thanks for reading my commentary. Hope it helps! Stay safe! $Semiconductor Bull 3X Shares(SOXL)$ $NVIDIA Corp(NVDA)$ $Advanced Micro Devices(AMD)$ $Tesla Motors(TSLA)$ $NIO Inc.(NIO)$
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