Compression of S&P Continues…

It seems that while the FED tries to push rates up and take out the November 4th high rate, nothing seems to be happening with the all-important S&P other than its price is being compressed in an explosive way.

In the meantime, traders are pressuring lesser areas of the markets, especially the area that I call the New Economy area. This is the area that includes Biotech, Solar, EV, and Chips.

I like to look at the markets and how they act after various fundamental points, which in terms of the following analysis are: 1) June 6, 2022 when commodity inflation peaked; 2) November 4, 2022 when the total interest rate curve peaked (this is the average for the 30Y, 10Y, 5Y, 2Y, and the 3 mon rates); and 3) December 14, 2022 when the FED indicated that it was going into overkill mode.

Here is the performance data for the various Sectors/ETF’s/Indexes sorted within each period following the fundamental point.

Period 1 “Hiding” Period 2 ” Investing” Period 3 “Investing”

An explanation of terms for some of the sectors or indexes we include for our own analysis are:

infr = infrastructure;

comp = all assets

wb-fang = wanna be tech fangs

EPCC = Eureka-perspective New Economy composite

As you can plainly see, since the FED went into overkill mode, traders have been hiding in infrastructure, oil, commodities, gold, Ag, and abandoning all the areas that will shape the New Economy. I will be watching for the turnaround of that direction.