Is the carnage over?

The markets have certainly been dealt a blow since printing record highs just 3 weeks ago. The initial pullback was quicker than Usan Bolt bounding through 100 meters. A weak bounce followed and then Tuesday another drop retesting or exceeding the initial lows. Sentiment seems to be solidly in the bearish camp with many analysts I know now firmly believing the big one (a la Fred Sanford) is coming. Google carnage and the picture above is what you find, with the caption the Ultimate Villain.

The evidence for more downside is out there in the price action. Momentum turning lower, volatility picking up, prices falling under key levels state the case. And I will be the first to agree that the evidence and the sentiment it creates will always outweigh the fundamental picture. But fundamentals do come into play at some point.

And looking for or considering a major meltdown seems to be unwarranted at this point. S&P 500 companies are posting earnings growth over 25% with revenue growth over 7% as this quarter is evolving. Hardly the backdrop for a recession or major draw down. The carnage may not be over but a wipe out seems to be of low risk. Will this market rebound or will it turn out to be the Ultimate Villain?

This is a magical time of year in Cleveland. It was a great season for the Tribe but it ended in disappointment. Now the Browns are playing just well enough to not win games and the Cavs look like they may go 0-80. It makes me want to start the Fall sale I am so giddy! Starting today, you can get 20% off an annual subscription. That is only $600 for a $750 annual subscription. Don’t miss out! Subscribe here.

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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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