A tale of 2 markets. Angels and demons

Posted: July 14, 2020 in Uncategorized
Source: Pinterest

This market is utterly scary. While it still playing with the June reversal island scenario (has not broken the 2 resistances on SP500 3180 and 3225) it is an utterly scary market. Yesterday intraday reversal was not seen since March 2008.

On one side we have the current market sistained by the Fed, Robinhood accounts and the vaccine coming ever closer.

On the other side we have continuous virus resurgence, elevated valuation, Fed balance sheet.

This can lead to a crash or a blow off top in equal measure.

Portfolio construction with real diversification (remembering that in 2008 only currencies and gold maintained diversification) can help. The most important is to be psychologically ready to anything as even both situations can happen before year end.

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