After the spectacular first quarter rally in the stock market, things suddenly look not as bullish anymore. For some mysterious reasons, quite a number of large financial firms came out calling for lower price levels in coming months. This sudden change of tune, of course, upset many bulls.
For the die-hard bull fans, they think they have found an angle that can’t be disputed. Namely, such strong first quarter performance always lead to a strong year in the past. Well, just like what I have warned last year that there would be no Christmas rally while all these so called “objective” analysis saying that 100% we would, I think they are again, wrong.
I said this again and again to people that, volatility is not the same as direction change. When you can’t distinguish whether we are just seeing a rise in volatility (which is the case right now) from actual directional change (like the major market bottom in the past), you have no idea what you are talking about.
I can actually use the exact same argument the bulls use – because we just got a six month of high volatility rally, a crash is imminent. In fact, it is also true 100% in the past.
So what do I think? It will be a messy high volatility environment. All it takes is aliens suddenly invade Earth or any other one-second event to end our financial markets (and the world). No point guessing.
Jim Bianco’s take on the current financial landscape and the threats on US dollar’s reserve currency status. His position is a reasonable one.
Here is another video from Jeffrey Snider whom I find willing to say what everyone else already know but choose to say nothing because they fear that one day they may have burnt the bridge somehow.
There is really no point pointing fingers at the Fed for doing what it is tasked to do. Hugh Hendry makes this point very clear – Powell is at a place that he has limited options and all of them are bad. So be ready if the unthinkable happens.
I just made a statement about the future of daytradingbias.com. For those of you who are members of the site, you may want to check it out.
Happy Easter!
