I’ve said it many times on this blog before: the only signals that matter are oil prices and high-yield bonds. Ignore everything else, specially the buffoonery on television, which is there to distract you and make you stupid. But if oil and junk debt continue to breakdown as they did today, prepare yourself for a big selloff. If you’re a trader you go to cash. If you’re a long term investor, you wait for stocks to get cheap. Only time will tell if this is a buying opportunity or a warning sign of things to come.
And for some perspective:
The S&P 500 is up 16% YTD and the Nasdaq is up 20% since January.