If there's one universal law financial markets follow — as a reader reminded me recently — it's that they prove most people wrong most of the time.
Yours truly very much included.
No sooner had "Sell in May and go away" been declared a relic of times past — and/or a lazy excuse for Wall Street to get an early jump on summer in the Hamptons, Saint-Tropez, or Marbella — than the first Friday of June handed us a doozy.
One of those hundred-year floods that somehow happens twice a year.
Everything went down: stocks, bonds, precious metals, currencies, oil.
Nowhere to hide.
The overbought stocks got hit worst, some down double digits.
A timely reminder that markets are non-ergodic, chaotic, complex systems prone to selling cascades. And if you think the better-than-expected jobs print - possibly flattered by FIFA World Cup hiring - was the only culprit, I've got a fully sovereign slab of land on Mars to sell you.
Now the tape.
Last Saturday I flagged first support @ 7400-ish. The market, ever the literalist, ran to fresh highs @ 7600-ish, then reversed and closed the week @ 7384.
First support, located.
But context matters. The 10-week SMA is rising @ 7200-ish. The 50-week SMA is still way down @ 6750-ish. So this is a stretched rubber band snapping back toward support, not a broken trend.
Yet.
Base case: still an uptrend, now correcting an obvious overextension.
7400-ish is the first line to reclaim.
Below that, 7000–7200-ish is the real floor: prior resistance, now support, with the rising 10-week sitting right in that zone.
Invalidation remains unchanged: a weekly close below 7000-ish.
That would turn this from a correction into a likely test of the 50-week.
Thanks for reading.
🙏🏻🙏🏻👊🍻
If there's one universal law financial markets follow — as a reader reminded me recently — it's that they prove most people wrong most of the time.
Yours truly very much included.
No sooner had "Sell in May and go away" been declared a relic of times past — and/or a lazy excuse for Wall Street to get an early jump on summer in the Hamptons, Saint-Tropez, or Marbella — than the first Friday of June handed us a doozy.
One of those hundred-year floods that somehow happens twice a year.
Everything went down: stocks, bonds, precious metals, currencies, oil.
Nowhere to hide.
The overbought stocks got hit worst, some down double digits.
A timely reminder that markets are non-ergodic, chaotic, complex systems prone to selling cascades. And if you think the better-than-expected jobs print - possibly flattered by FIFA World Cup hiring - was the only culprit, I've got a fully sovereign slab of land on Mars to sell you.
Now the tape.
Last Saturday I flagged first support @ 7400-ish. The market, ever the literalist, ran to fresh highs @ 7600-ish, then reversed and closed the week @ 7384.
First support, located.
But context matters. The 10-week SMA is rising @ 7200-ish. The 50-week SMA is still way down @ 6750-ish. So this is a stretched rubber band snapping back toward support, not a broken trend.
Yet.
Base case: still an uptrend, now correcting an obvious overextension.
7400-ish is the first line to reclaim.
Below that, 7000–7200-ish is the real floor: prior resistance, now support, with the rising 10-week sitting right in that zone.
Invalidation remains unchanged: a weekly close below 7000-ish.
That would turn this from a correction into a likely test of the 50-week.
Thanks for reading.
🙏🏻🙏🏻👊🍻
If there's one universal law financial markets follow — as a reader reminded me recently — it's that they prove most people wrong most of the time.
Yours truly very much included.
No sooner had "Sell in May and go away" been declared a relic of times past — and/or a lazy excuse for Wall Street to get an early jump on summer in the Hamptons, Saint-Tropez, or Marbella — than the first Friday of June handed us a doozy.
One of those hundred-year floods that somehow happens twice a year.
Everything went down: stocks, bonds, precious metals, currencies, oil.
Nowhere to hide.
The overbought stocks got hit worst, some down double digits.
A timely reminder that markets are non-ergodic, chaotic, complex systems prone to selling cascades. And if you think the better-than-expected jobs print - possibly flattered by FIFA World Cup hiring - was the only culprit, I've got a fully sovereign slab of land on Mars to sell you.
Now the tape.
Last Saturday I flagged first support @ 7400-ish. The market, ever the literalist, ran to fresh highs @ 7600-ish, then reversed and closed the week @ 7384.
First support, located.
But context matters. The 10-week SMA is rising @ 7200-ish. The 50-week SMA is still way down @ 6750-ish. So this is a stretched rubber band snapping back toward support, not a broken trend.
Yet.
Base case: still an uptrend, now correcting an obvious overextension.
7400-ish is the first line to reclaim.
Below that, 7000–7200-ish is the real floor: prior resistance, now support, with the rising 10-week sitting right in that zone.
Invalidation remains unchanged: a weekly close below 7000-ish.
That would turn this from a correction into a likely test of the 50-week.
Thanks for reading.
🙏🏻🙏🏻👊🍻
If there's one universal law financial markets follow — as a reader reminded me recently — it's that they prove most people wrong most of the time.
Yours truly very much included.
No sooner had "Sell in May and go away" been declared a relic of times past — and/or a lazy excuse for Wall Street to get an early jump on summer in the Hamptons, Saint-Tropez, or Marbella — than the first Friday of June handed us a doozy.
One of those hundred-year floods that somehow happens twice a year.
Everything went down: stocks, bonds, precious metals, currencies, oil.
Nowhere to hide.
The overbought stocks got hit worst, some down double digits.
A timely reminder that markets are non-ergodic, chaotic, complex systems prone to selling cascades. And if you think the better-than-expected jobs print - possibly flattered by FIFA World Cup hiring - was the only culprit, I've got a fully sovereign slab of land on Mars to sell you.
Now the tape.
Last Saturday I flagged first support @ 7400-ish. The market, ever the literalist, ran to fresh highs @ 7600-ish, then reversed and closed the week @ 7384.
First support, located.
But context matters. The 10-week SMA is rising @ 7200-ish. The 50-week SMA is still way down @ 6750-ish. So this is a stretched rubber band snapping back toward support, not a broken trend.
Yet.
Base case: still an uptrend, now correcting an obvious overextension.
7400-ish is the first line to reclaim.
Below that, 7000–7200-ish is the real floor: prior resistance, now support, with the rising 10-week sitting right in that zone.
Invalidation remains unchanged: a weekly close below 7000-ish.
That would turn this from a correction into a likely test of the 50-week.
Thanks for reading.
🙏🏻🙏🏻👊🍻