In a rare act of God, we were right! Well, at least for a day. And they’ll never be able to take that away from us.
Stocks, commodities, and just about everything got taken to the woodshed today – with the DOW and S&P shedding over 2%. Oil got hit too – there was literally nowhere to run.
US stocks opened down, and drifted even lower throughout the trading session, with the DOW, S&P, and NASDAQ all circling the bowl.
One more disturbing trend for stock market bulls – these drops are occurring on high volume days, while the rallies lack much punch behind them – indicating there is more conviction on stock market drops than there is on rallies:
Courtesy of StockCharts.com.
Reflation trade cheerleaders should take note – if today seemed familiar, it’s likely because we’ve seen this movie before. The market already tipped its hand during the Great Deleveraging of 2008.
If we see another bout, expect it to be the same story until further notice – dollar up, everything else down.
Recommended reading: Three key sanity checks at this inflation-deflation inflection point.