MARKET ENVIRONMENT: by Woody Dorsey. Sentiment came in at @ 9% Bullish. This is a melt down. None of what is happening is a surprise other than the speed of it: “Yes, we understand that Structural Tightening in Financial culture will continue for years. Hyperinflation remains a Real Risk. It is prudent to be cautious. Some less mature investors have only seen Bears in zoos! This is the real animal. This market action is a harbinger and a tell of things yet to come.
NEAR TERM: Fears of the FOMC remain dominant. This is a Market War so, stay Wary. Potential for short term highs and lows abound but there is no road map in this terrain. Take each day as it comes.
INTERIM TERM: The Interim profile still suggests a better low late in the fourth quarter. There is nothing bullish about this market. Big Bears typically take their time toying with everyone. It can all happen quick, too. That seems to be the game.
DORSEY MARKET SENTIMENT: The main point is that Sentiment was overly optimistic for many years, even decades. That has changed. This is a different sentiment era. The recent cluster of very low sentiments is ‘telling’ of a significant Recognition. It signals an alteration in the investor psyche.
MARKET SUMMARY: Repeat: “Equity Markets remain under secular pressure. This is SECULAR. It is prudent to be cautious.” Central Bankers will be grappling with Hyperinflation for a long time… Longer than anyone thinks.” Volatility and Uncertainty aren’t going away. Embrace them. Enjoy any bounces. You know the real story. It looks like the Summer could have more potholes! There will be another leg down into year end.
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