Market review 23.07.09
Hello everyone,
Today I’ll begin with a look at the broad market, the roles played by VIX & positioning, and then we’ll look at some individual sectors.
Broad market
The S&P 500 has been trading sideways for the past 3-4 weeks. I view this as a healthy rest within an uptrend.
The SPY:IEF monthly chart gives us some big-picture perspective. It made an 18-month breakout in June - the 4th significant breakout in the past 15 years.
Credit markets certainly agree. Junk bonds are holding their recent breakout relative to Treasury bonds:
The US also continues to shine relative to the rest of the world. Among 55 of the largest country & regional equity ETFs, SPY is the 2nd closest to 52-week highs (behind only GREK).
The world ex-US also just made new all-time lows vs. the Nasdaq-100 this week.
The market’s message is clear.
The role of VIX and positioning
During the Mar ’20 Covid crash, the VIX spiked to a record level of 87. Fast forward to today, and it’s sitting below 15 (near the low end of its historical trading range).