Amazing. In the UK the market (not the economy). erased all the declines, all the COVID, all the shmovid, all the inflation, all the wars. No more war, no more bloodshed. It wants All Time High. And it’s only 0.55% from there.
Will the US stock market follow? If we look at the US equities futures and risk-on assets like Bitcoin, we have seen them rally, recently, as well. But they are far from their colleagues such as the DAX in Germany and FTSE in the UK. Their late bullish reversal and distance to make up for testing previous highs, is such that, to me, these markets should be giving the UK market more fuel.
By the way, regarding Bitcoin, which people love or hate, this “digital currency” has been showing some interesting tells about risk sentiment and it’s correlation to the ES or NQ futures, and is followed by many traders and firms. After an almost 30% rally, will BTC soon meet a triple resistance and make a leg down?
And the UK stock market does not need a lot of fuel to surpass that all time high. It’s only about half a percent away from that ATH. I may even surpass it this week.
The VIX is low, below 20, so keep an eye on possible developments there.
And, of course, next to the center stage of the Fed (which is kind of already priced in, isn’t it?) then we have the secondary stage, which is becoming the center stage: Quarterly earnings. That is still less known, thus, less priced in.
Will GOOG crash due to the risk of ChatGPT (but will that push up MSFT stock)? Will META, which has been showing clear relative strength over its peers, signal in its earnings that Whatsapp for Business has been underpriced? Will NFLX hold its astounding rebound in the past months? And what about smaller companies that have got a moat in their markets, such as Unity Software Inc. (U) in the mobile gaming and animation space? A stock that crashed with so many others, will it signal in its earnings that this dip is really over and can be recorded back to 2022? While every earnings season is key, this will be the most important earnings season we have had for a while. The participants have not been so confused and the bears and bulls so edgy, for a long time.
The UK market seems to want more. When it gets the ATH, will it fake the bulls and drop like a rock?
