Investment thesis for trading week 10/5 - 10/9
Investment thesis for trading week 10/5 - 10/9
As charts suggested we made new highs for tech this week! The S&P 500 should follow soon.
Yeah, yeah, yeah I know inflation is high and the Iran war is ongoing.
Bond yields keep on rising but this week's volume in TLT suggests that yields might have peaked. Regardless I bought more bonds for short term accounts and long term accounts now hold 17% long term bonds at a 5.3% risk free yield.
From a chart perspective stock market breadth is at lows not seen since the dot com crash but small caps touched the 200 day average and could bounce from here which would automatically increase breadth.
Investor sentiment has seen more bears than bulls for weeks now and at some point that should at least trigger a counter rally.
We are entering a seasonally favorable period for stocks.
We only need a few good news to spark a rally. I am sorry a strong rally is unlikely with put/call ratios at current levels. It would more be a choppy grind higher.
But talking about needed good news. A divided Government has always been good for stocks. If Dems win the Senate and House that alone would propel stocks higher while still leaving the growth policies in place.
Earnings season is coming up soon as well again.
From a chart perspective everything is set up for a continued grind higher with the potential of a quick rally if we get any positive news on Iran, inflation or the bond side.
Have a great weekend