It’s counter-intuitive and can be difficult to abide by when the bullets are flying on any given day, but if you’ll recall back in 2019 the little micro sentiment adjustments – mostly courtesy of Trump’s trade war bombs lobbed at China – actually sustained an over-bullish market with a series of little pullbacks on the inflammatory news du jour. They often lasted a day or so.
I don’t want to take an over-bullish, over-loved market lightly for its high risk, but today feels like another of those micro adjustments at the instigation of the news cycle (new UK virus strain, Flynn advises Trump to impose martial law and oh by the way, why not bring back the lunatic lawyer you already fired once in an effort to cling to power?). It’s all noise.
I don’t want to discount dangerously over-bullish sentiment, but the VIX for one is twitching, and if this is not the big one ‘Lizabeth! (reference showing my age) then it could serve as short-term fuel for the market, 2019 style.
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