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Grandpa Hits It Out Of The Park
by Alex King
The Dow hit all time highs yesterday. As we have noted all through 2023 here, we believe the S&P and the Nasdaq will also make new highs - potentially this year or, if not, then early 2024. The Russell 2000 is a huge laggard and the question is, will the Russell also move up - it has quite some way to climb - or will it continue to dance to a different tune? IWM now sits right around prior resistance levels, so the question is timely.
As regards the three main indices, we can each construct compelling arguments as to whether they will continue to moon, flatline, or roll over and quit out. My own view is that there is going to be a lot of stress in the market right now - bears have taken a drubbing and are stressed, sensible bulls will worry that this is a Big Money trap designed to pull in retail funds so that Big Money can distribute stocks bought at the 2022 lows, and are stressed in case the gains evaporate, and absentee investors will worry that they should have invested a year ago and will now pile in with fear as well as dollars. This isn't a recipe for a slow-grind-up market, it's a recipe for volatility; throw in Q4 opex on Friday and the scene is set for a proper ole cliffhanger.
We can call it Market MaxQ.
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US 10-Year Yield
Just broke the channel to the downside; let's see if that is a sustained breakout.