SPY - SP500: The Euphoria Stage

2024-05-17 06:57:51 ET

Summary

• The recent meme trading exuberance indicates that the market is in the euphoria stage, and this is reflected in the S&P 500 as well.
• The S&P 500 is trading based on the expected first Fed cut, with the soft-landing implications.
• The market is ignoring the early recessionary data and still high inflation (stagflation).

The madness - that's the macro context

Generally, a bubble reaches the top during the euphoria stage. That's the stage when the sentiment completely takes over the reason, and prices completely disconnect from reality.

Before discussing the S&P 500 ( SP500 ) implications, it's important to put things in context....

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