The stock market rally

The clock is ticking stronger on the stock market rise that professionals never believed in !!!

The stock market rally that saw some positive momentum in early 2023 may be at risk, as multiple factors point to an imminent market correction. In recent weeks, the stock market has reached the same midline that doomed the Bulls in 18 August 2022, leading many to question the sustainability of the current rally.

In addition, the first big blow of the year in the pullback and buy strategy, bond warnings and hedge fund disappointment are all contributing to growing unease among investors.

*The halfway line means doom for the Bulls:

The rise in the ST-P 500 index reached the same halfway line in 18 August 2022, and the doom of the Bulls was the sustainability of the current stock market rally.

*The first big blow against the deep buying strategy:

The deep buy strategy, which buys stocks during a market downturn, has been one of the strongest in decades. However, this year he dealt the first big blow to the strategy, which led to warnings to those who relied on it to invest. The pullback buying strategy was a key factor in supporting the stock market and its failure may indicate a more pronounced pullback.

*Bond warnings:

Warnings, also came from the bond market, whose upward momentum had previously given investors confidence in stocks. However, now the bond market indicates a possible market correction, which worries equity investors. The bond market is often seen as a barometer of market sentiment and its recent negative signals are a cause of concern for investors.

*Vigilance among hedge funds:

Vigilance is also evident among hedge funds, with the largest contraction in two years, according to data from Goldman Sachs Group Inc. The ST-P 500 index has fallen by 1.1% over the past five days, which is the worst week on the occasion since mid-December. This stagnation in the stock market, coupled with the withdrawal of investments from hedge funds, indicates growing uneasiness among investors.

*The risk of rising stock prices:

Rising stock prices, which have raised stock prices by 5 trillion dollars, are a cause for concern. With central bankers claiming that their anti-inflation campaign may be years old and that earnings and economic data continue to decline, buying stocks is now a risky proposition.

*Ratings are high by historical standards:

Valuations are high by historical standards, and it is risky to bet against critics who agree that stocks need a correction. Current stock valuations are at levels not seen since the 2008-2009 financial crisis and many experts warn of a possible market correction.

*Betting against the expert category:

Betting against the category of experts who agree that stocks have their results to settle is a risky move. The expert category, consisting of market analysts and economists, has a wealth of knowledge and experience and their views should be taken seriously.

*The role and impact of raising interest rates on the national economy:

Tom Heinlein, national investment strategist at US Bank Wealth Management, says that the impact of the interest rate hike that began in early 2022 is likely to be felt in the first half of 2023 and adds that there will be little confidence in the sustainability of this recovery until the impact of interest rate hikes on the real economy appears.

The stock market has risen in recent months, but some critics have begun to issue warning signals about its sustainability. The rise of the S&P 500 index reached a mid-level threshold that indicated a problem for bulls in the past. This comes after the first big win of the year for a submerged buying strategy that was on a scale as strong as any year since 1928-1929.

Adding to these fears, warnings issued by bonds that were previously considered a bullish signal for equity investors have become. This belief has now been shattered because the links no longer offer the support they once enjoyed. Another sign of trouble came as hedge funds trimmed their positions in a way not seen in two years, according to data from Goldman Sachs Group. The ST P 500 index recorded a decline of 1%. Over the past five days, recording its worst week since mid-December.

Even if the poor performance of the market does not necessarily prove anything, it indicates the danger that stock prices are currently rising. Stock prices are inflated by 5 trillion dollars as central bankers warn that their anti-inflation campaign could be years away and that earnings and economic data are still weak.

Investing in stocks now means betting on high valuations, well above historical norms, and competing against a class of experts who more than ever believe that an adjustment should be made.

" The first half of the year is likely to show the impact of the interest rate hike that began in early 2022 and is finally affecting the economy," says Tom Heinlein, national investment strategist at the US bank management. From the origins". We will not be completely confident that this recovery that we saw in early 2023 is sustainable until we see the impact of raising interest rates on the real economy, " he said.

The summary:

* In summary, time is running out for the stock market rally and experts are warning of its potential danger. The midway level, the first major success of the dip buy strategy, bonus warnings, and disenchantment among hedge funds all point to potential troubles. The risk of rising stock prices, combined with high valuations and a tight-knit panel of experts, means that investing in stocks now requires some risk tolerance. The impact of rate hikes on the real economy in will be critical to the sustainability of the rally and investors should tread carefully until more information becomes available.