Black Monday or Face Ripping Rally?
Right now, markets are on a razor’s edge — and whether we get a Black Monday-style crash or a face-ripping rally depends on a few big wildcards in play:
π Black Monday Case:
Markets could tank hard if any of these spiral:
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Tariff Fallout: Trump's sweeping tariffs are hitting real-time now. Global retaliation (China, EU, etc.) is escalating. If corporate margins and consumer prices get squeezed, recession fears intensify.
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Inflation Flare-Up: If new tariffs reignite inflation, the Fed may stay hawkish longer — bad for risk assets.
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Recession Risk: RBC just warned the S&P 500 could drop to 4,200–4,500 in a full-blown recession scenario.
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Sentiment Crash: The market’s been on edge — a sharp move down could trigger a snowball of selling (momentum funds, stop-losses, margin calls).
π Face-Ripping Rally Case:
But there's fuel for a huge upside move too:
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Oversold Conditions: The S&P just had its worst slump since 2020. Technicals could trigger a bounce, especially if macro headlines ease.
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Relief Rally on Clarity: If tariffs are seen as more bark than bite — or exemptions expand — markets might rally on reduced uncertainty.
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AI, Tech, and Bitcoin Tailwinds: Mega-cap tech remains resilient; Cathie Wood is calling Tesla at $2,600 in 5 years. Bitcoin is surging again (whale accumulation, +700% since Saylor started buying).
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Positioning: If everyone’s leaning bearish, even neutral news could spark a squeeze.
π§ What to Watch:
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Monday’s futures action and Asia/Europe market opens
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Any tariff exemptions or walkbacks
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Upcoming CPI/PPI prints
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Fed speak — they’ll weigh in if volatility spikes
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Earnings season — guidance will matter more than results
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