From Kris Sayce – Port Phillip Insider (Australia) –
After going sideways since mid-July, the US S&P 500 was bound to break out from its range at some point.
That point happened to be last Friday.
The issue now is whether this is one of those little ‘pullbacks’ the talking heads on CNBC like to talk about, or whether this is the start of a much bigger fall.
If you’ve followed my commentary in Port Phillip Insider, you’ll know that I have grave concerns about the sustainability of the high level of the S&P 500.
The fact that stocks have gone up over that time isn’t unusual. And the fact that stocks have hit a number of new highs isn’t unusual either.
After all, if stock prices could never reach a new high, the market would never go up!
The biggest problem (as we see it) is what’s going on with earnings for S&P 500 companies.