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Does MM believe the S&P500 is set for a pullback?

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Question asked 07/07/2023

Does MM believe the S&P500 is set for a pullback?

Hi Guys Still loving your works. I'm finding it very beneficial. Is the current divergence of the S&P500 and VIX another signal of a pending pullback? Any thoughts what a trigger could be?

Answer

Hi Paul,

We covered part of this question in Friday mornings “What Matters Today” report, our view is the current leg higher by bond yields will cause a pullback in the S&P500:

Importantly its our core view that this current rally by short-dated bond yields will reverse but over the coming weeks its likely to weigh on investor sentiment.
Our initial target for this retracement by the S&P500 is the 4300 area, only 2-3% below Thursday nights close.

chart

US S&P500 Index

LAST UPDATED 07/07/2023 11:28

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