Stocks & Forex
The US Stock Market Is In A Vulnerable Position
The daily chart of futures for the S&P 500 index shows that the price has risen above the upper line (1) of the bearish channel and has been trying to gain a foothold there for several days.
However, in the past (in this version of the channel construction), there were several false bullish breakouts, when the price could not keep the progress made and fell back into the channel. How will it be this time?
Notorious Wall Street bear Michael Burry (the movie “The Big Short” is based on his story) tweeted yesterday: “You have no idea how short I am.”
That is, he believes in a pessimistic scenario.
A Conference Board survey of CEOs of large companies showed that 85% of respondents believe in a moderate recession in the US over the next 12 months. 68% believe in a deep recession in Europe.
JPMorgan advises to cut longs in stocks as the risk of recession in the US has not gone away. And the Fed is hinting that it is impossible to beat inflation without a recession.
Yesterday’s news about industrial production in the US gave a signal that increased the likelihood of a recession — it unexpectedly declined. The capacity utilization is also falling.
Given the above, the resistance of 4000 for futures on the S&P 500 index acquires not only a psychological, but also a fundamental basis. So far, it has not been broken through, and this may be a sign that heralds a new bearish reversal.
