Continuation of rotation – without interruption is mostly an April Fool’s joke as was the argument (not just by politicians) that ‘prices were declining’. 
Pexels It’s a point here to avoid the political aspect, but there’s no doubting our viewpoint on the ‘pace of inflation slowing’, but not higher prices inherently persisting.That’s been our point all year, and today’s ISM numbers (and even the PCE the other day) amplify reasonably economic stability consistency, but also of course the impact (especially) of ‘Food & Energy’ on price levels overall. This was viewed as a non-transient increase in prices, because you had ‘relief’ of course from post-pandemic price spikes, that retreated to rise at lower levels (a slower pace), while still consistently rising.The big risk ‘black swan’ right now will be an Iranian / Hezbollah missile strike on Israel directly, after their terrorist coordinator was killed in Damascus. War widening risk now steps to the front of the line. Otherwise rebound prospects. 
To say otherwise is just politics, or it’s incorrect interpretation of data, which is why some Fed members resist the trend to be ‘friendlier’ too soon, while also validating our assessment of Oil price impacts, as does geopolitics. The ‘data harvesters’ trying to ‘avoid’ Food & Fuel is basically massaging data, given a clear link between Oil prices and so many other aspects of everyday life.Now, I want to reiterate that there is a ‘yin & yang’ to this, because lower rate Fed policies (at any extreme) could be tied to economic misfortune, and that is not good for markets. Easing rates ‘slightly’ (presumably not politically but we’ll see) would be helpful, and some segments (like residential mortgages) already reflect this anticipation. If it doesn’t materialize that’s problematic. 
Most of the concerns relate primarily to the big-cap stocks. This year we’ve focused a good bit on smaller-cap ‘sprinkled’ speculations, some worked as well as some failed, while others are pending outcomes later in the year and next year for that matter. Never do we encourage a large portion of portfolios to concentrate in speculations, but we also encouraged taking some portions of bigger-cap holdings off the table into strength, so it’s hard to recommend a money manager or investor buy into extreme strength, though some do that. 
Market X-ray: Selling Calls (say 2 standard deviations above price as well as shorter in duration) might be reasonably timely for those inclined and focused on an income-rather-than gain strategy for mega-cap stocks they own.The stock market probably will try to rebound, but is entitled to cool-off, and that was our warning for April’s kickoff (a stumble). We’ve not encouraged an options-writing strategy for big-caps basically until now, because we thought S&P would hold together or advance, and it did. We don’t like real estate as an investment right now (commercial and residential especially in Florida on coastal areas), we envision being a little protective and oddly that might be a decent hedge by writing Covered Calls on the pricey stocks, but the already battered ones are better for a little Call buying, or common shares, or wait).S&P is pretty-stretched above it’s 200-Day Moving Average so overdue recoil that we thought would deliver a ‘stumble’ to start-out April’s 1st trading day. 
The period of time in which we’ve been overbought is incredible, actually it’s as long as we had coming off the pandemic lows. A ‘check-back’ to even the standard deviation mean on our (90-day chart in the video) would be roughly 5150 +/-, but we don’t even have that much downside moment, just a hiccup so far. Let’s see if they can bounce S&P Tuesday after a mixed start.More By This Author:Market Briefing For Monday, April 1Market Briefing for Thursday, March 28Market Briefing for Wednesday, March 27, 2024
