{"id":71832,"date":"2024-12-22T13:53:55","date_gmt":"2024-12-22T21:53:55","guid":{"rendered":"https:\/\/drduru.com\/onetwentytwo\/?p=71832"},"modified":"2024-12-22T15:42:43","modified_gmt":"2024-12-22T23:42:43","slug":"after-plunge-quick-rebound-tests-new-resistance-the-market-breadth","status":"publish","type":"post","link":"https:\/\/drduru.com\/onetwentytwo\/2024\/12\/22\/after-plunge-quick-rebound-tests-new-resistance-the-market-breadth\/","title":{"rendered":"After the Plunge, A Quick Rebound Tests New Resistance – The Market Breadth"},"content":{"rendered":"\n

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

The dust is settling ever so slightly on the stock market’s post-Fed plunge. The stock market shifted from euphoria to oversold<\/a> on a day that woke up everyone to a potentially new market reality. I say “potentially” because all year the market has been hit with bearish catalysts and quickly bounced back as if nothing happened. Along the way, the market seemed to look forward to rate cuts as an excuse to remain focused on the green grass on the other side. Those rate cut dreams have now been dashed in dramatic form. Since rates conventionally shape the valuations investors are willing to tolerate, the next catalysts will have to be exceptionally strong. Economic growth<\/a> is already about as strong as it can get, so maybe massive tax cuts will be the magic promise to keep the market focused forward?<\/p>\n\n\n\n

Next year’s catalysts need to be exceptionally strong because there is every reason to believe that optimism and valuations are at historic highs and extremes. For example, the chart below shows the highest percentage ever of investors expecting the stock market to go up in the next 12 months. This chart comes from Charlie Bilello’s The Week in Charts (12\/19\/24)<\/a>; it is full of golden nuggets of market extremes that I will use for reference in 2025!<\/p>\n\n\n

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