Everyone from commentators to collaborators were harping the tones of a “Santa Clause Rally” in the markets to finish out the year. Although anything is possible, things are starting to look ominous for that idea.
As I type this on Monday morning (~7:00am EST) the “markets” have entered what I am coining the “Danger Zone” intoning Kenny Loggins.
As you can see from the chart posted below of the S&P 500™ futures via a daily candle/bar chart, we’ve now broken what in technical analysis terms is known as “a primary trend-line.” Remaining anywhere within that highlighted “danger zone” area means just that: danger, where anything can happen and usually does.
To make the point once again, although this represents the overnight futures market, that line still represents a doubling of the Feds balance sheet by spending another $4,000,000,000,000.00 (4trillion) plus in 20 months, plus another $120,000,000,000.00 (120billion) every month known as QE (quantitative easing) not forgetting another $2,000,000,000,000.00 (2trillion) in government hand outs, rent and college loan moratoriums and more. And now it’s all ending not forgetting the other latest multi-trillion-dollar boondoggle proposal known as “Build Back Better” that too was to save everything is now officially nixed.
So, as always, we shall see. But since I’m intoning other famous peoples lines. I might as well end with one of history’s most profound for brilliance from none other than Alfred E. Neuman…
© 2021 Mark St.Cyr
Note: This is not trading or investing advice of any sort. This commentary is for “big picture” discussion purposes only. Please read, or re-read the “About This Site” page for any questions or clarifications.