Stocks survive "fragility test" of April. Roadmap for May more constructive = recovery towards S&P 5,200

The video in this report is only accessible to members
The video in this report is only accessible to members
The video in this report is only accessible to members
The video in this report is only accessible to members

VIDEO: Stocks likely fare better in May, after surviving the "fragility test" in April.  Also, lots of important macro data this week

Please click below to view our Macro Minute (duration: 5:38).

The video in this report is only accessible to members
The video in this report is only accessible to members

Two weeks ago, we noted that equities were about to face a "fragility test" given the dual risks of fears of inflation resurgence + Middle East conflict. And at that time, we expected stocks to face "knee jerk de-leveraging" but ultimately we expected stocks to survive this test. As we exit April, the rally of the past week has bolstered our confidence that the worst of the selling is done, and thus, we believe probabilities favor stocks to stage further gains in May.

The equity rally last week is a reminder that the "buy the dip" regime remains in effect, as long as the Fed is not hawkish. This is an age-old adage but has proven true since October 2022. Last week, in particular:- stocks fell on "bad news" (poor reaction to $META disappointing earnings guidance)- stocks falling on "bad news" is not a sign of a top, falling on "good news" usually is- stocks rallied on "bad news" when March core PCE came in hot The S&P 500 is down -3% so far in April (still 2 trading days left). At ...
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