Seasonal Data
Historically, February is weak; I think it will be March this time.
Historical data suggests the Market is due for a pullback.
Investors remain under-invested
Leverage (Margin Debt) remains low. Market euphoria hasn't begun yet; investors are not fully invested. The next significant dip should come with an increase in margin debt.
Money market funds continue to see record highs. The yield on uninvested cash is very attractive to those worried investors. When the Fed begins the cutting cycle, cash will flood into equity, bond, and crypto markets.
If Daddy Dollar continues lower, it becomes a tailwind for risk assets. If the opposite occurs, it becomes a headwind. By the end of the year, my bet is it's much lower.
Crypto Summer
Crypto Summer is when financial conditions become ripe enough for speculation to drive FOMO. This is the Banana ZONE! hold on to your seats
BANANA Zone 👇🏽
Bitcoin and the broader digital asset market are entering the "Banana Zone." This is where prices start to move parabolic. Expect 20% to 40% rallies and 20% to 25% pullbacks. In Crypto Summer, rollercoaster pullbacks are key for entries.
Economic Factors
Economic growth continues to expand while LEI's (leading indicators in manufacturing) begin to recover. Very bullish
Manufacturing Momentum has stalled this month, which means two things.
The economic cycle is gaining momentum (Early cycle recovery)
Bond rates can stabilize.
We are getting closer to the rate-cutting cycle as Fed Inflation continues to fall.
Global shipping rates are cooling off, which should help bring down inflation.
My instincts tell me we are near a reveal point, to which we see a sharp drawdown, followed by consolidation and a strong buy-the-dip mentality.