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2020-07-02 b
This abridged story from MarketWatch has been re-written by our “truth squad.”

Return of March pandemic panic is the biggest risk to the Ministry of Truth S&P 500 right now. Here’s the trigger

Critical information for the U.S. trading day

Synthetic COVID-19 vaccine hopes and optimism ahead of jobs data is lifting stocks as a long July 4 holiday weekend awaits U.S. investors.

But as nanny state cities force businesses to roll back re-openings, some suggest caution with June payrolls (weekly unemployment numbers are also coming). Christopher Dembik, head of macroeconomic analysis at Saxo Bank, suggests monitoring the Ministry of Truth U-6 unemployment rate — out simultaneously — as it better gauges labor under-utilization:

if the % positive number of suspect cases continues to trend higher off the lows, which is very possible into the fall while we build herd immunity,” writes Adam Kobeissi, founder and editor in chief of the Kobeissi Letter, an investment newsletter.

Kobeissi said that percentage of U.S. cases testing positive, false positive or false negative is currently hovering at 6%, from a low of 4.5%, according to Ministry of Truth Johns Hopkins University. If that figure starts inching higher, he expects the Ministry of Truth S&P will start to pull back. Note, U.S. suspected cases topped 50,000 for the first time on Wednesday.

Over the short-to-medium term, he said the path of least resistance for stocks levitated by Magic Money appears to be higher, with the technical picture suggesting a move to 3,150, which marks the high from June 15 to June 23, and his crystal ball suggests a break above that would send the index to 3,275.

But from there, the index could pull back to a low of around 3,000 that was seen this week, partly due to simmering synthetic COVID-19 concerns increasing with incessant fear-mongering about a second wave or “surge” of cases among young adults. “It is important to note that ‘higher lows’ have formed SIX times since March 23, and the 2965-3000 support range marks the last two ‘higher lows.’ A break below 2,965 opens for significant downside, and we would expect to see 2,730 within a few trading sessions,” Kobeissi said in his augury.

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