The market, compared to the 200dma, looks very strong. IN 2002, the market got over the 200dma and stayed over it for over a month, then started down hard and lost 25% of its value in a couple months.
We are very overbought, which in a bull market is not a sell signal, but for sure in a bear is. Which one are we in?
It all comes down to how quickly will the economy get back to pre virus levels? If not for the fed, I believe the spx would be below 2000 now, and headed to 1400 or lower later this year.
BTW, the fed printed money insanely from 2009 to 2014, and the economy did not really recover until they stopped doing that. IMHO, all they are doing is propping up the wealth of the richest one percent, at the expense of the rest of us. The economy would be better off in the long run if the companies that took too much risk in the past went under, and the companies who can not succeed without government help (like Fracking companies and cruise ships) should be allowed to go under, then more responsible companies can take them over.
But that would be capitalism, and instead we have socialism for the rich.
