Mechanical Bull: What’s Really Behind The Summer Stock Rally

It's certainly tempting to cite the "peak inflation" narrative and attendant expectations for an incrementally less hawkish Fed as the proximate cause for a "sticky" rally in US equities. Halfway through August, there was scant evidence to suggest stocks were inclined to roll over after a weekslong surge found the Nasdaq arguing for a new bull market designation, while the S&P eyed its 200-day moving average. In our haste to ascribe causality, it's worth taking a step back to remind ourse
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7 thoughts on “Mechanical Bull: What’s Really Behind The Summer Stock Rally

  1. This article points to the value of technicals vs. fundamentals if you trade or for good entry points if you invest. It also shows the validity of the theory of reflexivity by Soros. It will be interesting to see what happens to the market later this fall……

  2. H-Man, September will tell the tale. Headline inflation in the 7’s or steady in the low 8’s? Will core be stable or increase? NFP stays hot with a 400+ print or drops below 250? Will wages run hot? Housing continues to slide or stanches the bleeding? Energy continues to slide or holds? And probably the most important variable, where are the 10’s going? Hang around 2.70 to 2.80 or jump into the 3’s? Fed prints 50 but what about dots for November and December? You can use your own score card to make those picks.

    So by the end of September we will have most of those answers. The only certainty will be that flow will chase those answers.

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