Republic Risk: Just a Few Key Notes

As we wind down this trading day, expect one more day of relatively light volume. On Thursday, things will start to pick up.

Dear Fellow Expat:

This note will be brief.

There are just a few things that I want to mention about the state of the markets.

1. Technology has reverted to positive. I’d be very cautious, as the S&P 500 and the Nasdaq 100 show low-volume builds heading into the second most important factor of the markets: Earnings. Remember, the central banks are the key driver of most of our performance, and there are 70 miles of dirt. Then, earnings season. The trend is typically selloff, squeeze, drop. It happened in January 2022, April 2022, August 2022, February 2023, and August 2023. The charts are ominous right now.

2. Energy is negative. Interestingly, this is happening right now, but the Saudis are cutting prices, and something bigger is happening geopolitically after the country joined the BRICS last week. As I’ve noted, keep a close eye on the MACD here. It’s odd that oil prices are rising, but stocks are dropping. The upstream and downstream segments are both under pressure. It’s an excellent ti…