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POSITIONS: Long Utilities (XLU), Short Consumer Discretionary (XLY)

Soros would say markets are “reflexive.” I agree. Growth Slowing As Inflation Accelerates can be ignored as a fundamental fact only until it is reported as fact. Then, if the market reacts negatively to that fact – I guess it’s a more relevant fact!

Last week’s call was to down-shift your beta. Hopefully you did some of that. Small Cap and Basics Materials beta is getting smoked now that the US Dollar is attempting to solidify its stance above $79.03 TREND support.

Across all of my risk management durations, here are the lines that currently matter most: 

  1. Immediate-term TRADE resistance (was support) = 1366
  2. Immediate-term TRADE support = 1356
  3. Intermediate-term TREND support = 1283 

In other words, there is plenty of bullish support for this market – just from lower prices. We have not seen my immediate-term TRADE line (1366 today) snap and stay there (below the line) since December. So, stay tuned…

Our markets are addicted to inflation. So this, like mostly everything in markets, is going to be a process, not a point.


Keith R. McCullough
Chief Executive Officer

Growth Slowing: SP500 Levels, Refreshed - SPX