The stock market is signaling an excellent technical setup. Very high percentage of stocks in the leading categories are showing positive money flows. Several like energy, industrials, materials, financials and others have over 70% of the companies experiencing positive buying pressure. Even lagging sectors are turning more positive. It’s very interesting that business cycle stocks have been leading stock market recovery.
As many investors know, the consensus among strategists has been a negative view for the first half of 2023. This consensus, again, looks to be wrong. It is highly likely that the stock market has already started another bull run. It is being driven by declining inflation, an end in sight for Fed tightening, and perhaps most importantly, the reopening of China. Recovery in China will drive worldwide growth. A lot of good is converging for the new year.
No trend is a straight line. There will be doubts, disbelief, etc., but the money flow numbers are not lying. It is not too late; we are still early in the process. Stay steady my friends.