Much like the Greek Drama of years passed, when the short term moves of the market mirrored that days Greek headline, this trade war non-sense is getting old.
Trade War day one came back in the summer of last year:
Stocks were falling in anticipation. The tariffs were going to kill the market....
and yet the exact opposite happened.
I noted at the time how momentum was turning.... and turn it did. Prices went on to rally to new all time record highs across the board.
Coming into the new round of tariffs - price action remains negative. Momentum has yet to turn.
I've become a short term bear of the market here and remain that way despite some furious intra-day upside price action.
However when momentum begins to turn, as it did last summer, I think we will be faced with another tremendous buying opportunity, just like we did on the initial tariff kick off last summer.
This time around I noted the momentum shift, this one of the negative variety.
Momentum remains that way and until it turns I will keep my bearish bias.
The China Trade war headlines, and market reaction is getting very old. No doubt about it. The Greek headlines were getting old too. And yet the market continued to rally to record highs.
I dubbed it Greebola.
And it remains a great metaphor for this market today and since the lows in March 2009.
I think we will look back at this China trade war in a similar light years from now. But for now, in the heat of it, the China trade war is a boon for the financial media. Just like Greece was. And just like the Greek Drama, it will end the same. And record highs will follow. And some other drama will take its place. Another one the bears will try to sink their teeth into.