For the fourth of fifth time during this conflict, there was been a sudden spike of optimism, which sent equities flying higher—as seen in the S&P 500 futures chart below. Let me stop right here and make two things plain (1) I absolutely would love to see peace in Ukraine (2) As for the bear market itself, long-term, I don’t think it would make much difference.
In other words, don’t get tricked into thinking that a peaceful Putin suddenly means we are at the start of a marvelous new multi-year bull market. On the contrary, I think that, no matter how sensational the news might be, the bear market would re-emerge in a matter of days, if not hours, following any truly good, sustainable news.
In the short-term, however, the reactions were absolutely expected after it was reported Putin had mentioned “positive developments” with respect to the conflict. Thus, as equities surge, gold has been crumbling, having lost about a hundred bucks since its recent peak.
And over in small-cap land, the Russell 2000 futures, yet another bullish setup has appeared, and we are at the moment what would appear to be an interesting “buy” point.
HOWEVER—and this is the most important thing I have to share right now—look at all the good setups in recent weeks. Note the following:
- Each one is punier than its predecessors;
- Although the first one actually did yield a rally, it sputtered out, and since them, all of them have been wet firecrackers.
