The Profit Sector
Member Login
No Result
View All Result
The Profit Sector
Member Login
The Profit Sector
No Result
View All Result

Bull Markets Take the Stairs and Bear Markets Take the Elevator

Morning in the Markets

Briton Ryle by Briton Ryle
December 9, 2022
in Analysis
0
Person pressing on the fifth floor of elevator button. Hand press number 5 on button inside office or hotel lift. Index finger press on lift button. Claustrophobia. People stuck in lift. Braille code.

After two days of market nastiness, it doesn’t look like the sellers are done. It’s Wednesday morning, and S&P 500 futures are down 25 points as I write…

You might also like

Billionaire Investor: Cash is Better than Stocks or Bonds

How to Find Stocks That Go Up Alongside Rising Interest Rates

Can ChatGPT Choose Your Stocks?

The market got downright giddy last week. On Thursday, the S&P 500 made a wingnut 140-point move higher to break the downtrend line at 4,054. From Friday's 4,100 peak, the S&P has now given it all back… and then some.

A headline I saw this morning sums up why last week’s rally was a wingnut move: “It’s become increasingly clear the Fed can’t stop yet” regarding rate hikes. 

I mean, duh. 

There was never any real reason to think the Fed was about to stop the rate hikes. Inflation has barely ticked down. But making money and having a good rally can be a pretty good incentive to suspend disbelief. 

Economic data has come in strong for the last couple of days, and that’s driving stocks lower. Simply put, all the Fed’s rate hikes are not slowing the U.S. down enough to affect inflation, and that’s troubling…

Because we’re at 4% right now, another 0.50% is coming next week, which will take it to 4.5%. There are Fed meetings in January and March. Will a couple of small hikes at those two meetings – to 5% of 5.25% – achieve what all the previous hikes haven’t? 

That seems very unlikely, and that’s why investors have suddenly turned so pessimistic this week. 

There are a few canaries in the coal mine we can look at:

  • Bank of America (NYSE: BAC) got absolutely hammered yesterday, down more than 5% from its lows. It’s the biggest consumer bank, and the prospect of higher rates and a weaker consumer is not a good combo for it.
  • The Volatility Index – the VIX –  measures pessimism and has jumped from 19 on Friday to nearly 23 this morning. 
  • Oil tends to move in tandem with economic growth expectations. Growth means resigning demand and higher prices. China’s moves to end COVID lockdowns should mean a substantial boost for economic activity, but crude prices have dropped from ~$80 to $75 a barrel over the last couple of days.

If there’s any consolation in all this, it comes from the old saying that bull markets take the stairs, and bear markets take the elevator. In other words, big declines happen fast. And that’s certainly been true this week. 

In fact, the selling has been so severe that prices have fallen all the way to a fairly nice support point: 3,920 on the S&P 500. That level has been hit a couple of times in the pre-market, and we could see a bounce off that level today…

That’s it for now, take care, and I’ll talk to you soon.

brits-sig

Briton Ryle
The Profit Sector

Related Posts

  • The Stock Market is in a Bottoming Process That Will Lead to 17% Upside
  • Market Bubbles and The Collapse of the Cryptocurrency Market
  • The Next Generation of Stock Market Leaders
Tags: Bank of America (NYSE: BAC)The FedVIX
Briton Ryle

Briton Ryle

I’ve been trading, investing, and sharing my insights with individual investors since 1998.  Back then, the internet was not a very useful research tool. Armed with a library card and a huge budget for the printer, I’d scroll the microfiche for Wall Street Journal and Financial Times articles. I bought technical books on wireless technology and fiber optic networks. I traveled to Chicago to learn the secrets of stock options trading directly from the experts on the floor of the CBOE.  I’ve attended and spoken at more investor conferences than I can remember…. All because I’ve always taken my responsibility to my readers and subscribers very seriously. I refuse to parrot popular opinion, offer up half-baked ideas or publish incomplete or half-hearted research.  There is no shortcut to deep research... becoming as close to an expert on topics, trends, and technology as possible. And the rewards are life-changing. The very first stock I ever recommended was South Korea’s SK Telecom. My readers enjoyed a 150% profit in a matter of months.  And after 25 years, I’ve helped tens of thousands of readers change their financial fortunes.  A few months ago, I donated all my suits to Goodwill, pulled my name off the list of speakers for the big investor conferences, and left the big city for Southern Georgia. The plan was to retire to the banks of a tidal creek that splits off from the St. Mary’s river as it enters the Atlantic between Cumberland and Amelia islands... and trade stocks when I felt like it. But, I guess retirement wasn’t for me after all. I’m back, and this is gonna be something special. 

Recommended For You

Billionaire Investor: Cash is Better than Stocks or Bonds

by Profit Sector Research
February 4, 2023
0
Billionaire Investor: Cash is Better than Stocks or Bonds

Cash becomes more attractive as the Fed raises rates and Americans are racking up record credit card debt...

Read more

How to Find Stocks That Go Up Alongside Rising Interest Rates

by Adam English
January 31, 2023
0
Digital stock market falling graph and blurry coronavirus. Concept of stock market crash due to covid 19 coronavirus pandemic. 3d rendering toned image double exposure

It's practically beaten into us. Inflation up? Interest rates up? Stocks down! But companies are making money. Some more than others thanks to the interest rate changes...

Read more

Can ChatGPT Choose Your Stocks?

by Jimmy Mengel
January 28, 2023
0

Is the new wave of artificial intelligence a danger to humanity, a boon for investors -- or both?

Read more

Bags of Cash: How the Rich Get Richer

by Jimmy Mengel
January 31, 2023
0
Bags of Cash: How the Rich Get Richer

Why investing in luxury goods is a smart move in today's market...

Read more

The Investor’s Guide to Investing in a Bear Market or Recession

by Adam English
January 21, 2023
0
stock market bull vs bear digital style

A bear market looms and the threat of recession is global. Investors need to know what to expect. Here it is...

Read more
Next Post
Dollar currency growth concept with upward arrows on charts and coins background

Where to Find the Safest High Yield Dividend Stocks

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recent Posts

Billionaire Investor: Cash is Better than Stocks or Bonds

Billionaire Investor: Cash is Better than Stocks or Bonds

February 4, 2023
Digital stock market falling graph and blurry coronavirus. Concept of stock market crash due to covid 19 coronavirus pandemic. 3d rendering toned image double exposure

How to Find Stocks That Go Up Alongside Rising Interest Rates

January 31, 2023
Legendary Investor: “More Losses to Come”

Legendary Investor: “More Losses to Come”

January 28, 2023
3 New Dividend Aristocrats Are Crowned

3 New Dividend Aristocrats Are Crowned

January 28, 2023
  • Home
  • Member Login
  • What is The Profit Sector?
  • Meet Our Team
  • Join The Profit Sector Monthly
  • FAQs
  • Featured Articles
  • Dividends and Income
  • Analysis
  • Investment Strategies
  • Saturday Digest
  • Terms and Conditions
  • Privacy Policy for The Profit Sector
Contact Us

Protected by copyright laws of the United States and international treaties. This website may only be used pursuant to the Terms and Conditions and any reproduction, copying, or redistribution (electronic or otherwise, including on the World Wide Web), in whole or in part, is strictly prohibited without the express written permission of The Profit Sector, LLC. 415 1st Ave N #19868, Seattle, WA 98109

© 2022 The Profit Sector, LLC. All rights reserved. Our website provides stock market research, commentary, and analysis. Information is provided “as is” and solely for information purposes, not for trading purposes or advice.

Nothing on this website should be considered personalized financial advice. Any investments recommended herein should be made only after consulting with your personal investment advisor and only after performing your own research and due diligence, including reviewing the prospectus or financial statements of the issuer of any security. The Profit Sector, its managers, its employees, affiliates and assigns (collectively "The Company") do not make any guarantee or warranty about the advice provided on this website or what is otherwise advertised above. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. The Company is not affiliated with, nor does it receive compensation from, any specific security. To the maximum extent permitted by law, the Company disclaims any and all liability in the event any information, commentary, analysis, opinions, advice and/or recommendations provided herein prove to be inaccurate, incomplete or unreliable, or result in any investment or other losses.

No Result
View All Result
  • Home
  • Member Login
  • What is The Profit Sector?
  • Meet Our Team
  • Saturday Digest
  • Frequently Asked Questions
  • Privacy Policy for The Profit Sector
  • Terms and Conditions

Protected by copyright laws of the United States and international treaties. This website may only be used pursuant to the Terms and Conditions and any reproduction, copying, or redistribution (electronic or otherwise, including on the World Wide Web), in whole or in part, is strictly prohibited without the express written permission of The Profit Sector, LLC. 415 1st Ave N #19868, Seattle, WA 98109

© 2022 The Profit Sector, LLC. All rights reserved. Our website provides stock market research, commentary, and analysis. Information is provided “as is” and solely for information purposes, not for trading purposes or advice.

Nothing on this website should be considered personalized financial advice. Any investments recommended herein should be made only after consulting with your personal investment advisor and only after performing your own research and due diligence, including reviewing the prospectus or financial statements of the issuer of any security. The Profit Sector, its managers, its employees, affiliates and assigns (collectively "The Company") do not make any guarantee or warranty about the advice provided on this website or what is otherwise advertised above. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. The Company is not affiliated with, nor does it receive compensation from, any specific security. To the maximum extent permitted by law, the Company disclaims any and all liability in the event any information, commentary, analysis, opinions, advice and/or recommendations provided herein prove to be inaccurate, incomplete or unreliable, or result in any investment or other losses.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In

Add New Playlist