{"id":62482,"date":"2022-12-23T14:48:03","date_gmt":"2022-12-23T22:48:03","guid":{"rendered":"https:\/\/drduru.com\/onetwentytwo\/?p=62482"},"modified":"2022-12-24T15:09:54","modified_gmt":"2022-12-24T23:09:54","slug":"second-chance-for-path-of-least-resistance-the-market-breadth","status":"publish","type":"post","link":"https:\/\/drduru.com\/onetwentytwo\/2022\/12\/23\/second-chance-for-path-of-least-resistance-the-market-breadth\/","title":{"rendered":"A Second Chance for the Path of Least Resistance – The Market Breadth"},"content":{"rendered":"\n

Stock Market Commentary<\/strong>: <\/h2>\n\n\n\n

Revisions to the report on GDP (gross domestic product) typically do not generate reactions in the financial markets, especially the third revision. So I completely look past the third revision to Q3 GDP<\/a> when I concluded the path of least resistance offered a reprieve<\/a>. The revision revealed economic conditions were even better than previously reported, and the stock market practically freaked out. In an inflationary environment with a hawkish Fed, the stock market treated this good economic news as awful news (for a fresh explainer, see “Why Wall Street Wants A Recession<\/a>“). Buyers shook off their stupor as the NASDAQ tested important lows. Gains on Friday and a plunge in the VIX offer fresh hope and a second chance for a path of least resistance pointing upward.<\/p>\n\n\n\n

Perhaps most importantly, last week delivered the largest ever weekly outflows from equity funds<\/a>. If anything can clear out a second chance for an upward pointing path of least resistance, the exhaustion of sellers can certainly do it. This airpocket of selling could even carry holiday cheer into early January before the prevailing bearish winds blow again.<\/p>\n\n\n\n