Bounced perfectly off of the 61.8 retracement (2020 low to 2022 high). Total drawdown from 2022 high to 2022 lows was about 37%. Looking back in history, the length and drawdown is about average at this point for a typical recession. One has to wonder, is the bottom potentially in?
The trend, as seen on the Madrid ribbon, is clearly negative and sloping down. We are not out of the woods yet for long term investors but we may see a sizeable pop here to the upside for a swing trade. After that, we will see what happens. China will reopen, the Ukraine war will eventually come to an end (let's hope soon), and the feds will eventually be forced to pivot due to inflation easing. Where the world will be after all of that passes, only time will tell. The bond market is giving us signals to stay very cautious and nimble.
This is not financial advice. Good luck!
The trend, as seen on the Madrid ribbon, is clearly negative and sloping down. We are not out of the woods yet for long term investors but we may see a sizeable pop here to the upside for a swing trade. After that, we will see what happens. China will reopen, the Ukraine war will eventually come to an end (let's hope soon), and the feds will eventually be forced to pivot due to inflation easing. Where the world will be after all of that passes, only time will tell. The bond market is giving us signals to stay very cautious and nimble.
This is not financial advice. Good luck!