another terrible day so I'm choosing to wipe it away.
I am 60% cash now and not planning to make any big moves for the rest of the year.
I am simply observing charts and seeing the cracks in the market appear. The push up is almost 100% stimulus and printing. There are a few bright spots like AMZN but the valuation is ridiculous.
The cracks I see now are a flat JNK etf.
Investors seem to no longer pay up for debt. Leaders in finance: axp, jpm and aig have peaked. GS, BAC, and C also seem to have faded.
Utilities is one of the strongest sectors now. Natural gas is in a glut.
The only question really is how long this can keep up? Is there a bottom to the dollar? And even if there isn't, can risk trade go on indefinitely with few signs of improvement?
Obviously, the charts will show the way. Goldman peaked almost 2 months ago:
However, it is not ready to collapse.
The retail index RTH is almost at the peak of the collapse in the summer of 2008. What a run for retail. Do people really want to be new buyers now? Really?
Just how long can this market keep doing this? I don't know, but there are a few warning signs now. This is all about stimulus... but eventually, it becomes about valuation and fear and reality too.