Indice S&P 500
Short

Welcome to the Recession... a SPX and Inflation Rate Correlation

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This chart is scary... The Covid-19 black swan event worked against us on the macro trend and we are heavily overbought on the yearly, but that wasn't enough for me.

I linked the inflation rate's 200EMA (and viewed the average's price direction) and support lines on the SPX and found something quite scary for long-term investors.

This is the first time in 40 years that the average inflation rate monthly and per year (per long-term period) is going up and has a positive slope...
Last time we had the average inflation rate going up per year, we recessed for around 20 years.

My thoughts...?

I think this last resort inflation spike (as a result to Covid-19) is an opportunity for investors to get in for a quick recession. This could be a place where big buyers trade a range for around 5-10 years minimum for massive gains because of this debt scandal. This recession could act as a bigger scheme for other investment sources such as crypto or other commodities for a massive transference of wealth. Last time we went sideways and down, massive properties beyond technical analysis were at play.

IF... the EMA reverses downward due to the FED's lowering of inflation rates, we could see a retest on the EMA 200 or supports on the SPX and other markets with a rebound to the ATH. But, as our debt grows and our federal reserve takes their own fiat's value away to "combat that," I don't know if we will see a quick bottom. We will most likely recess for around a year or two before we make our way back up again if we were to see a short lived bottom.

Accumulate commodities or dollars, sell off market for now. Trade the sideways.

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