Sentiment Speaks: Is It Now Time For The Market Crash I Have Been Hearing About?

Have you seen all the negative things that have been thrown at the market of late? Well, if you have not, let me tell you what you missed.

We had the Russian/Ukrainian war, oil rallying strongly, the supposed death of the US Dollar, China shutting down because of another Covid variant, nuclear threats, an earthquake and tsunami warning in Japan, the Fed raising rates, reducing its balance sheet, and outlining 6 more rate hikes... oh, and don’t forget the scary “death cross” that all the financial media was reporting.

It seems that everything has been thrown at the market, including the kitchen sink, yet we have seen quite a strong rally. In fact, how many of you news-hounds even realize that the market bottomed on the exact day that Russia invaded Ukraine, and has now rallied 350 points (8.5%) off the bottom struck that day?

I know this has left so many of you scratching your heads. But, if you are scratching your head, I guess you did not learn the lesson the market taught in the spring of 2020. While the worst of the Covid death rates were being reported, while there were economic lockdowns being reported throughout the United States, while companies were drastically lowering their earnings expectations, while we were seeing record levels of unemployment, and while economists were proclaiming we were about to go into a recession, the stock market rallied over 1000 points in an almost straight line higher, as per our expectations at the time. I know many of you have seen me post this picture before, but it tells the story so well.

So, while I view it as beating a dead horse, many of you still believe this news-horse is alive and well and can be rode with reliability. All I have to say is that those are some really good blinders you must be wearing.

In the meantime, I will be traveling over the coming week to Israel, where I am going to be able to meet the many wonderful people who run Seeking Alpha every day. So, I do not have much time to write this article, and it will be relatively short.

In the coming week, I am expecting the market to top out, and provide us with the last opportunity for the bears to take us to a lower low. But, I think there is a high probability the bears will likely fail. Our support now is in the 4345/50SPX region. And, as long as the next pullback holds that support, I am expecting to next head to our next higher targets.

I will not likely be able to do any more updates for a few weeks due to my travel schedule. So, have a great week.