Warning Signs 03 (Jun 19 - Jun 23)

[winston]

A recession indicator that predicted every downturn since 1969 started flashing months ago—and a Wall Street veteran warns it always works on a delay

by Will Daniel

Since 1969, a yield curve inversion has preceded every U.S. recession.

Historically, after the yield curve inverts, it takes ~15 months for the economy to officially enter a recession.

Applying this same time frame to the current inversion (roughly one year ago), the economy could enter a recession in October of this year.

The first half stock market rally this year is not “sustainable” and said she expects to see a “10% to 15% decline when investors become realistic with the interest rate, economic and earnings environment.

Source: Fortune

https://finance.yahoo.com/news/recessio ... 31735.html

[winston]

These are the bearish signals investors should monitor to stay ahead of a potential sell-off in stocks, according to Bank of America

by Matthew Fox

Bearish signals in the stock market are beginning to percolate following the S&P 500's rally, according to Bank of America.

The bank highlighted various technical signals that have yet to confirm the breakout in stocks.

"Dow Theory has yet to confirm a primary bull market from late 2022," Bank of America said.

1. Dow Theory confirmation.
The Dow Industrials need to break above the 11/30/2022 peak at 34,590, while the Dow Transports need to clear the 2/2/2023 peak at 15,641 to confirm a bull market.

2. Negative divergence in breadth signal.
A higher low for the NYSE stocks advance-decline (A-D) line vs a lower low on the NYSE Comp (NYA) provided a December 2022 into March 2023 bullish divergence for market breadth.

3. High-yield credit spreads have not confirmed rally.

Source: Business Insider

https://finance.yahoo.com/news/bearish- ... 02966.html