Major stock market indexes have been falling since the new year. The S&P 500 was down over 8% and the NASDAQ 100 was off 13% year-to-date as of Jan. 26, 2022.
Here is a summary of what we wrote in our Jan. 3, 2022 Stock Market Update:
"Market breadth is poor, defensive sectors are outperforming and major sectors/industry groups that are dependent on a healthy economy are not confirming the market’s advance.
"Additionally, stocks are severely overvalued and extended, the Fed is going to be removing liquidity this year and inflation is going to be a persistent problem.
"Unless conditions change dramatically the stock market is at an increased risk of some type of correction."
Stocks have fallen decisively in 2022. Major indexes are now below their respective 200-day moving averages. Now that the market is oversold, what should we be looking at for clues to where the market is going?
For a detailed analysis of market conditions please view our YouTube Market Update Video.