Summer rally may turn into a bear trap, proceed with caution

Yesterday, Aug. 22, U.S. financial market analysts were warning of a “bear trap”. Should you be concerned?

Yes, they said that U.S. stocks could slip away from this summer’s big rally…

“The 17% rally off the June 16th low seems consistent with historical bear market rallies, on average returning over 17.8% before reversing course and hitting new market lows,”

– Glenmede analysts,

To reach that conclusion, ~50 years of U.S. stock performance history were analyzed.

The article goes on to say that a number of factors will decide what happens next.

So, what are some of the factors/variables in play?

  • Federal Reserve/U.S. central bank announcements and decisions
  • Inflation controls
  • Interest rate controls

Now, with that in mind, here’s where it gets intersecting, contradictory, and obvious…

The very next day, today, Aug. 23, the same outlet, MarketWatch, leads with a brand new story stating the following projection for next month, September:

The source of September’s terrible stock market record remains as mysterious as ever. Since 1897, the first full year of the Dow Jones Industrial Average’s DJIA, -0.41% existence, the U.S. market benchmark has produced an average loss of 1.13% in September. That compares to an average gain of 0.77% across the other 11 months of the calendar. No other month comes close to being as bad as September, as you can see from the chart below.
September mystery of Dow Jones through 1897

(The bold is my emphasis.) Remains as mysterious as ever? Really? You mean, we can drill into the last ~50 years of trends to form a conclusion, but when it comes to ~125 years of a mysterious slump, there is no conclusion?

Folks, the markets are manipulated, and a lot that is connection with them. I’ve been saying this for a long time…

Why are critical information absent in almost any popularized explanation? Often times, I see a projected outcome, but the underlying mechanics remain a mystery. We’re told or sold possible reasons as to why. Rarely do we see more!

Politician getting paid

We’re left thinking, well this or that may occur, and they say this or that is why…but what is the real, reality of a situation?

The truth is, in many instances, we may not know. Any one of the most important lessons in life is noticing where you put your attention. If you constantly focus on “knowns” or “unknowns”, either option can become an attention/resource drain because your brain is curious, which sounds to me, a lot like a form of hypnosis…

From my perspective, if you engineer a populace who is always on the bring of expecting a crisis in one form or another, the fear portion of the brain readily pursues the dangled carrot. Human attention is the ultimate resource, no? You cannot convince a person of something if you do not have their attention.

Therefore, with alleged crisis abound – and bountiful scoops flavorful, yet often nutritionless information at one’s disposal – many attention-information-reliant industries seek novel ways to persist; inclusive of military-industrial, food and drink, traditional or legacy media, and social media. Certainly, from 2020 through today, we have seen many timely and profitable inventions in the name of crisis.

Drilling down further, if you essentially gridlock financial markets in a never-ending drama, mix in political personalities, television pundits, well-known media outlets who are so official, they must be considered trustworthy (right?), you then see a real-life soap opera, that today, many people are waking up to and rejecting. I believe that is why you see social media companies, like Meta/Facebook, trying to force virtual reality experiences and ads on people who would, in actually, find the technology unnecessary, unnerving, uninteresting, or invasive. Here’s a more direct example…getting lured into the news on MarketWatch or related sites (that do have some understandable value for the lives of some), many of those websites are selling ads that use algorithms that measure your attention. The first goal of advertising is to get you, your attention on the objective. Once that’s achieved, everything else you do on the site is marketable in some way!

Wake up and see what's going on

What does the true alternative reality look like? I people it includes genuine interactions among people, for starters…

So, my point here is to be healthy with where you place your intention because others for well over 125 years, it seems, have well understood that “…where attention goes, energy flows!”

Good trading!

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