The S&P 500 Index suffered its second major correction in 2018 with last week’s decline of 6.74%. As you can see from a chart of the S&P 500, last week’s correction broke through the index’s 200-day moving average. It’s the third time this year the market broke through its support. And while the market has bounced a bit as of Monday afternoon, investors are left questioning whether this market can rise above its long-term support one more time, or finally roll over. To answer that question, investors need to take a step back and look at the macro-view. Read More
The S&P 500 Index suffered its second major correction in 2018 with last week’s decline of 6.74%. As you can see from a chart of the S&P 500, last week’s correction broke through the index’s 200-day moving average. It’s the third time this year the market broke through its support. And while the market has bounced a bit as of Monday afternoon, investors are left questioning whether this market can rise above its long-term support one more time, or finally roll over. To answer that question, investors need to take a step back and look at the macro-view. It’s About Interest Rates One of the most prescient indicators of a future recession is the yield curve. Most of the time, the yield curve is positive, meaning longer dated bonds have a higher coupon than shorter dated bonds. But, there are times when the yield curve inverts – meaning long rates are lower than short rates. When this happens, the probability of a recession grows markedly. —Recommended Link— 148-Year-Old Firm Performs Magic Trick: 10K Transformed Into $58,000 The company that took the top spot in our new Legacy Asset portfolio has a 148-year advantage over most of… Read More