"The bear market is over": founder of Sundial Research
The S&P 500 has seen 110 reversals in the previous 135 sessions, representing 1% changes from the high or low at the close. Recent sessions have seen an extraordinary increase in the volume of buyers eager to gain exposure.
"The bear market is over," Sundial Capital Research founder Jason Goepfert said Tuesday, referring to an extremely macro data point.
"In modern markets, the S&P 500 has never lost ground in the following year when advance volume was 87% or more of total volume for 2 days on 3 after a 52 week low. It has a perfect track record,” Goepfert said in a tweet.
"Of course, that doesn't prevent short-term losses," he said. “Of course, I can't predict the future. Of course, this time it's different. Of course, it would be good to have a larger sample. ** Beware of anything that looks 'perfect'", the founder of SentimenTrader said.
This is indeed a significant move: stocks are set to suffer further losses as soaring inflation and an increasingly belligerent Federal Reserve continue to pose risks for the economic outlook, according to Morgan Stanley strategist Michael MS Wilson.
"The countertrend rally may continue, but make no mistake, we don't think this bear market is over, even if we avoid a recession," Wilson said , which estimates a 36% risk of recession over the next 12 months.
The fed funds target range was raised by 75 basis points to 1.5%-1.75% by Fed policymakers in June. This is the first 75 basis point rate increase since 1994.
Fed background: Federal Reserve Chairman Jerome Powell told reporters after the June meeting that another hike of this magnitude was scheduled for late July, with indications of still-strong inflation causing investors to reassess the outlook for the economy.
Normally, the central bank will not stop tightening until its key rate is higher than inflation. According to the Consumer Price Index and the Federal Reserve's preferred measure of personal consumption expenditure, the inflation rate is 8.6% and 5.2%, respectively.
Before the Fed changes direction at this rate, the labor market should suffer. As June jobs data shows, businesses added 372,000 more jobs than expected, and the unemployment rate held steady at 3.6%, near a 50-year low.
Morgan Stanley says it's too early to predict an impending recession; instead, the firm predicts "stagflation," in which inflation stays higher for longer as growth slows, but remains nominally positive, and financial markets remain volatile.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
The S&P 500 has seen 110 reversals in the previous 135 sessions, representing 1% changes from the high or low at the close. Recent sessions have seen an extraordinary increase in the volume of buyers eager to gain exposure.
"The bear market is over," Sundial Capital Research founder Jason Goepfert said Tuesday, referring to an extremely macro data point.
"In modern markets, the S&P 500 has never lost ground in the following year when advance volume was 87% or more of total volume for 2 days on 3 after a 52 week low. It has a perfect track record,” Goepfert said in a tweet.
"Of course, that doesn't prevent short-term losses," he said. “Of course, I can't predict the future. Of course, this time it's different. Of course, it would be good to have a larger sample. ** Beware of anything that looks 'perfect'", the founder of SentimenTrader said.
This is indeed a significant move: stocks are set to suffer further losses as soaring inflation and an increasingly belligerent Federal Reserve continue to pose risks for the economic outlook, according to Morgan Stanley strategist Michael MS Wilson.
"The countertrend rally may continue, but make no mistake, we don't think this bear market is over, even if we avoid a recession," Wilson said , which estimates a 36% risk of recession over the next 12 months.
The fed funds target range was raised by 75 basis points to 1.5%-1.75% by Fed policymakers in June. This is the first 75 basis point rate increase since 1994.
Fed background: Federal Reserve Chairman Jerome Powell told reporters after the June meeting that another hike of this magnitude was scheduled for late July, with indications of still-strong inflation causing investors to reassess the outlook for the economy.
Normally, the central bank will not stop tightening until its key rate is higher than inflation. According to the Consumer Price Index and the Federal Reserve's preferred measure of personal consumption expenditure, the inflation rate is 8.6% and 5.2%, respectively.
Before the Fed changes direction at this rate, the labor market should suffer. As June jobs data shows, businesses added 372,000 more jobs than expected, and the unemployment rate held steady at 3.6%, near a 50-year low.
Morgan Stanley says it's too early to predict an impending recession; instead, the firm predicts "stagflation," in which inflation stays higher for longer as growth slows, but remains nominally positive, and financial markets remain volatile.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
What's Your Reaction?
