Republic Risk: Market Breadth Stinks… Stay Defensive

Neel Kashkari - the man who doesn't understand America's adverseness to inflation - predicts that we will see a rate cut by December. The statistics suggest he's right.

Equity Storm Watch Is YELLOW on the S&P 500 and RED on the Russell 2000

Futures opened flat Sunday evening, while Asian markets opened under pressure to start the week—we’ll see if this winds up dragging on our own markets as the day progresses. We have a lighter week ahead: new retail sales data dropping on Tuesday and a batch of housing updates, including starts, permits, and sales. Plus, monthly options expire on Friday. With the first weeks of summer rolling in, expect trading volumes to dip as traders swap their desks for the sandy shores of the Hamptons and Rehoboth Beach, Delaware.

The lower volume is still pushing this market higher… as is the top tier of stocks. We are in overbought conditions again on the S&P 500 and Nasdaq 100, while the Russell 2000 bleeds off. The energy sector is in extremely bearish territory and fast approaching oversold. 

Equity Sector Strength

Every sector is weakening. The Technology ETF (XLK) is still ripping higher into overbought territory on the bac…