INTERVIEW DISCUSSION POINTS:
- The lack of fear amongst investors is clearly today’s investor sentiment.
- The low put/call ratio tells us the majority of traders are buying leverage betting on higher prices.
- Bonds and utilities have been trading flat with no one thinking they need any downside or defensive protection in their portfolio
- Everyone is focused on buying tech (XLK), discretionary (XLY), and biotech stocks (XLY), and ignoring economic sectors like energy (XLE), and Financials (XLF), airline sector (JETS).
- Based on Chris’s blended cycle analysis, we should see the market struggle and trade lower for another 8-10 trading sessions before finding a bottom and potentially rallying to test all-time highs.
- If we continue to see the US dollar and bonds start to move higher this week then traders should prepare for stocks to pull back another 4-7% from this level. This is generally an early warning sign of near term weakness in stocks.