Marketview: Post-Aggression Bid


  • Early in the week it appeared that a targeted US military missile strike was on track to destabilize the Assad regime. By the end of the week Putin had written an op-ed in the New York Times and cobbled together a plan for Syria to destroy its chemical weapons under the US chemical weapons convention. War premium is gone from equity and precious metals.
  • Jobless claims printed a recovery low on a tainted report. A computer issue is potentially to blame for inaccurate counting of the claims in two states. If the trend doesn’t continue in a similar direction next week on revision, look for a potential repricing event in the market. If we continue on target with the 4-week moving average, look for buy stops above to be hit and new highs for the market.


  • Industrials and basic materials led the market higher. Energy and utilities weighed on the market.
  • The whole world hates officially hates emerging markets. I’ve made my views known on struggle markets, but this might be a decent time to start a contrarian position.
  • Breadth was constructive but has yet to register new cumulative highs despite the market reaching within spitting distance of previous swing highs. Watch for divergence to develop should the market take out the old highs and breadth continues to underperform. It could take many weeks to fully develop any thesis that the internals of the market do not support higher prices.


  • Bullish sentiment regained dominant meme status in the market as investors are lulled into the security of an ever-present bid on every pullback. This is becoming a dangerous state of mind this late in the bull cycle.


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