2022 was a year of rejection. And it happened again today.
The most famous trend line in the history of trend lines is holding strong in the S&P 500. Today once again we see the market failing to hold above it. Looking back at the year of rejection, staples outperformed discretionary in a big way. What surprising is how big of an indicator it was. Every time the market touched the trend line it was time to dump discretionary for staples. A classic sign of risk off. Will today buck the trend or continue it? I’ll be watching closely.
Interesting today we are seeing the traditional risk off, bonds up and stocks down. Fear of missing out has turned into fear. Another thing we are watching is the VIX back above 20.