Market Notebook

PRICE ACTION:
Equity prices, as measured by ticker SPY, and bond prices, as measured by ticker BND, closed lower on the week.

TECHNICAL ANALYSIS:
Equity price consolidation June lows were tested and failed. This suggests a downward trend has been established in ticker SPY.

Despite short-term consolidation action in bond prices last week, BND appears to be in an established downward trend as well.

SENTIMENT:
Market participant sentiment was quite negative during the week. Market participants see only doom and gloom. Negative sentiment appears to be causing negative price momentum as not all instruments deserve to be treated equally.

Bond prices have come down significantly to the point where certain instruments are becoming attractive strictly on a valuation basis.

ECONOMY AND FUNDAMENTALS:
Regarding the real economy, the status quo continues. Significant inflationary pressures remain in the real economy, and the Federal Reserve continues to act to reign in those pressures.

NEXT WEEK:
Given the technical analysis picture, it seems prudent to avoid equity or bond purchases until downward price momentum slows.

Excellent opportunities will present themselves. Now is the time to determine where those opportunities exist so that when the technical picture changes, purchases can be made.

All the best during the week ahead!

Disclaimer: Nothing in this discussion should be considered investment advice. The content of this discussion is strictly my personal opinion and subject to change at a moment’s notice. Investment advice can only be provided to you by your investment professional and not by a general market discussion such as this one. If you wish to speak with an investment advisor, contact us. We can probably help.