From the desk of Steve Strazza @sstrazza
At the beginning of each week, we publish performance tables for a variety of different asset classes and categories along with commentary on each.
Looking at the past helps put the future into context. In this post, we review the absolute and relative trends at play and preview some of the things we’re watching to profit in the weeks and months ahead.
The weight of the evidence still suggests it’s prudent to be a buyer, not a seller, of risk assets for more meaningful time horizons.
Shorter-term, the market looks increasingly messy. For the first time in over a year, defensive assets are beginning to stabilize at logical levels of support, while stocks and major risk groups achieve our upside targets. Even a handful of some key Intermarket ratios are potentially diverging from the broader averages.
The macro backdrop definitely leans that this is just a sideways consolidation in an ongoing uptrend.
Let’s not forget that the S&P 500 has just recorded its greatest 52-week gain since the late 1940s, so some digestion is perfectly healthy and deserved!