Back in May I made a post "Market conditions don't foretell a market crash soon." Here we are almost four months later and not much has changed.
Again, some points here looking back to 2001. (2020 was an irregular event). Sorry for all the colors here, but everything is connected.
1. The Fed Rate (FEDFUNDS dark purple) falls before unemployment rises and recession. Note that the market rose while the interest rate was at its peak in 2006-2007 and 2019.
2. There are still more job openings than people to fill them (JTSJOL Non-Farm Job Openings minus USCJC US Continuing Jobless Claims - dark blue). Unchanged since May.
3. Unemployment Rate (UNRATE gray) rises as before SPX (yellow) drops. Currently UNRATE is pretty static and close to multi-year lows.
4. The following are static since May:
* Initial Jobless Claims (USIJC light blue)
* Continuing Jobless Claims (USCJC pink)
* Non-farm Payrolls (USNFP green)
* Job openings (JTSJOL light purple)
5. After a year in decline, M2 Money Supply is rising again (USM2 dark red).
6. The SPX drop last year was a result of inflation -> rate rises -> fear. But the recession didn't happen and the economy still looks strong?
Conclusion is that macro conditions don't foretell a market crash in the immediate future.
THIS IS FOR MY OWN RECORDS ONLY. NOT TRADING ADVICE. EVERYTHING CAN CHANGE VERY QUICKLY.
Again, some points here looking back to 2001. (2020 was an irregular event). Sorry for all the colors here, but everything is connected.
1. The Fed Rate (FEDFUNDS dark purple) falls before unemployment rises and recession. Note that the market rose while the interest rate was at its peak in 2006-2007 and 2019.
2. There are still more job openings than people to fill them (JTSJOL Non-Farm Job Openings minus USCJC US Continuing Jobless Claims - dark blue). Unchanged since May.
3. Unemployment Rate (UNRATE gray) rises as before SPX (yellow) drops. Currently UNRATE is pretty static and close to multi-year lows.
4. The following are static since May:
* Initial Jobless Claims (USIJC light blue)
* Continuing Jobless Claims (USCJC pink)
* Non-farm Payrolls (USNFP green)
* Job openings (JTSJOL light purple)
5. After a year in decline, M2 Money Supply is rising again (USM2 dark red).
6. The SPX drop last year was a result of inflation -> rate rises -> fear. But the recession didn't happen and the economy still looks strong?
Conclusion is that macro conditions don't foretell a market crash in the immediate future.
THIS IS FOR MY OWN RECORDS ONLY. NOT TRADING ADVICE. EVERYTHING CAN CHANGE VERY QUICKLY.
Comment:
oops - title should be "MACRO conditions don't foretell a market crash soon"