[PLUS] August Weight of the Evidence Dashboard: A Breadth Thrust, But . . .
Key Takeaway: This rally has more going for it than the March & May moves off the lows did, but it still needs to prove itself. The late-July breadth thrust was welcome evidence of strength in the broad market, but that it came as new lows continued to outpace new highs (36 weeks in a row and still counting) is curious. Moreover, the macro backdrop is still deteriorating. The July rally in stocks exacerbated the valuation picture and came as financial conditions remain poor and the economic data suggests that a recession is more likely than not. In short, the market has displayed surprising strength and impressive resiliency to finish July almost exactly where it began June. But there is still work to be done across the board to provide conviction that the environment that persisted over the first half of the year can be discussed in the past tense.
