Why is the Market Not Trading on Fundamentals Lately?
My main expectation is that the market will likely be topping out shortly in all of wave (3) off the February 2016 lows, and providing us with a wave (4) pullback, with an ideal target in the 2300SPX region, asserts Avi Gilburt.
Last week, I noted that as long as the market maintains support over 2450 S&P 500 Index (SPX), we still have potential to strike the 2500SPX region before we see a top to wave (3). Currently, the market has maintained such support, so I must maintain my expectations.
“The market is just not trading on fundamentals.”
“The stock market is detached from the reality of the economy.”
“Eventually, fundamentals will matter again.”
“The market just does not make sense.”
“The fundamentals just don’t seem to matter right now.”
In fact, this past week, I actually got the following comment to one of my articles:
“Avi, with all due respect, while you have been largely right from a technical perspective, the fundamentals are not present . . .”
Yes, I chuckled at that comment. It is almost like this person was saying, “even though you have been making a lot of money on the long side, the market is wrong because the fundamentals don’t agree.” Well, I would imagine the next words out of this person’s mouth should have been “now give back all the money you made on the long side because the market was wrong to give it to you in the first place.” (smile)
Over the last several months, I have heard every single derivative of these sentiments.