Monday Show Note

Today was an interesting day concerning the “markets,” for they seemed to be listening to the show themselves as they “screamed sideways” all day long, going precisely no where. Funny how that happens when the world is on the verge of WWIII via a possible nuclear escalation, the news out of both Ukraine and Russia all day has been both dire and dour as headline after headline crossed – and the “market” shrugged in a meh type reaction.

As I’ve said ad nauseam, “The markets care and only care about one thing: The Fed.” Today is a reminder of just how crucial to understand that premise truly is.

I’m going to post a chart that’s a close up of the one prior showing today’s resulting actions. What I would like to point your attention to are two notable items. The first…

Where did the “markets” finish at the end of the session? Precisely where it began right on that line I highlighted prior. Funny how it did that, kinda like the machines were programmed for it, I mean, whod’a thunk it, right?

Then there’s that little sell off that happened during the session. It’s that little downdraft that was almost immediately bought into to push the markets right back where they began.

What do you think caused that? A bad signal from Putin? More sanctions to further cut into the economy? More supply disruptions that will cripple us further? Possible grain shortages? WWIII warnings? Well, all those happened, but no, the markets did not react to any of that today. They reacted negatively to one thing and one thing only.

Fed Chair Jerome Powell stated the next hike or hikes could be 1/2% rather than 1/4% going forward.

Yes, that’s the only thing that moved these “markets” today. If he didn’t speak today the markets would have more in common with a flat-lined EKG than the one short blip it did produce. Kinda like there’s really no life-beat at all anymore. But, rather than just trying to describe it, here’s today’s “EKG of market health” for you to read for yourself. To wit:

(Chart Source)

See you tomorrow.

© 2022 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.