GDP will go negative as market reaches new all-time highs

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GDP will go negative as market reaches new all-time highs

If I told you that I received the GDP report the day before it was announced, and it showed that GDP came in almost half of the general expectations, 99% of those I would tell would automatically assume that the market would drop hard after it was announced. Yet, the market rallied 2% the day this was announced.

This past week, I presented a keynote address at the MoneyShow in Las Vegas. After my presentation, an older gentleman asked me a question as to whether I believed that the cessation of fighting in Ukraine would cause the market to rally. Being trained in law school, I answered his question with my own question. I asked him if he knew what happened to the market the day that Russia invaded Ukraine. Of course, his answer was that it clearly went down.

"It was a massive rally, and one that came out of nowhere. And it's left market observers like yours truly wondering what the heck just happened. There wasn't any new data, no headline-making speeches, no event that occurred just after the open to spur such a move. It literally came out of nowhere-and left us grasping for possible reasons."Today's market reversal was a head-scratcher," writes Oanda's Edward Moya. And he's not wrong.""...

"Observers' job, as they see it, is simply to identify which external events caused whatever price changes occur. When news seems to coincide sensibly with market movement, they presume a causal relationship. When news doesn't fit, they attempt to devise a cause-and-effect structure to make it fit.

Moreover, back in early March, I outlined the 3810SPX support region which I expected to be tested and likely held. . I am still of the same opinion in the higher degree structure. If we do break 4070SPX in the coming week, as long as the market continues to hold over that support in the coming weeks, I still expect us to challenge the 4300-4370SPX region."Let's start with the fact that the market has infinite possibilities of paths it can take at any point in time.

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