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Am I a bull or a bear at this point? I actually have no idea. So far, today's traverse to higher highs in the SP500 makes me wrong - that I know. I thought we'd continue to make lower-highs in the SP500. On the margin, any close above the 934 line (January 6th closing high) will be a bullish US equity market factor...

If you're looking for the rest of the sobriety check, don't worry - the facts don't lie. The ISM number that was printed this morning for the month of May came in at 42.8 (see chart below). While that's the best number we have seen since September of 2008, it is still a lower-high. New orders actually accelerated to 51, which is the best report we've seen on that front since November of 2007 (everything that happened after that was just bad).

Can the ISM reading, consumer confidence, etc. charge higher yet again in June? For sure - but can these sentiment readings breakout to levels above the red line in this chart? Or will they fail? These are some of the questions that will dominate the debate in my head as to whether or not the SP500 can make a move beyond 991. The easy REFLATION money on the long side is 3-months behind us.

KM

Keith R. McCullough
Chief Executive Officer

It Takes a Bull to Know..... - a1