The Real Threats to the Equity Bull Market
https://www.bloomberg.com/view/articles ... ull-market
Near-term indicators that track two- to four-week shifts are currently "overbought and turning negative as equity markets rally to resistance".
While the stock market readies for some downside, U.S. 10-year Treasury bond yields have "rebounded back to their 2017 downtrend," analysts added, showing initial signs of stalling or peaking.
The combo of lofty valuations and rising interest rates is about to wreak havoc on markets, potentially before the end of the year.
1. High-Beta vs. Low-Volatility Signal Flipped Bullish
2. NYSE Participation Ticked Above 60% Last Week
3. There's Conviction Behind the Rally
Historically, the stock market is bullish when the US Dollar is bearish.
For the moment it looks like the dollar could easily rise to the $95 – $97 level where it would encounter heavy overhead price-volume resistance.
I’m currently looking for the US dollar to rally to the $95 level… and for the US stock market to take a breather… possibly even as much as 5% – 7%.
If the dollar falls below $91, however, it will be a huge confirmation of even higher prices and valuations for US stocks.
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