Blogs -Broad Market Levels - August 18, 2022: Is a New Bull Cycle Building?

Broad Market Levels - August 18, 2022: Is a New Bull Cycle Building?


August 19, 2022

author

Knox Ridley

Portfolio Manager

Is a new bull cycle building? Last week Knox examined if the bear market rally will crumble or if a bottom is present. This week Knox notes that the high-frequency data continues pointing toward a slowdown with inflation. The ECB's tone is getting more aggressive, while the FED’s tone is getting less aggressive, suggesting that a new bull cycle is building as we speak. However, with data pointing towards a slowdown in rate hikes and inflation, we are seeing rates press new lows, and how the US dollar is pushing higher, only a few percentage points away from new highs.

Furthermore, crude oil appears to be bottoming and suggesting a run to new highs. In short, the macro factors have been putting pressure on equities and are not buying what the equity market is pricing-in yet.

Until we see 5 waves develop in the S&P 500 off the June low, accompanied by the USD confirming a top and rates signaling the low is in, calling for the end of the bear market is premature. Watch the broad market levels video update taken from I/O Fund's Premium 1-hour webinar below.

00:00 - Key Levels in the S&P 500
04:02 - Structure of the Leading Diagonal
05:13 - Small Caps
07:08 - Macro Assets/Commodities Pushing Equities
10:20 - The U.S. Dollar
12:12 - Crude Oil


Read Knox's Technical Analysis Commentary below.

Bond Market, Crude Oil, and Equities

The bond market is not buying bonds, suggesting that they are not buying the narrative driving equities; crude oil looks to be bottoming, suggesting another run higher is probable. When you factor in the macro forces that have been putting pressure on equities that are not lining up with the narrative expressed in the equity market, it’s worth being cautious until we know more.


Bull Market Signals

Assuming that this is the start of a new bull cycle, we only have 3 waves up off the low. This means we are not even done with the 1st wave of 5 in a new bull market that would likely move into 2023/2024


USD Signals

Until we see 5 waves develop in the S&P500 off the June low, accompanied by USD confirming a major top and rates signaling the low is in, calling for the end of the bear market is premature. Our plan is to wait for 5 waves to complete (wave 1) and then buy into the 2nd wave retrace.


Watch the Broad Market Clips from the Week of August 15, 2022:

Catch up on I/O Fund Broad Market Updates

This is Still a Warning Sign - Broad Market Analysis

Broad Market Levels Update - August 10, 2022 - Knox reviews why there’s still some uncertainty about whether this is the bottom or not.


About I/O Fund Premium Stock Investing Services

Premium Members currently enjoy all 7 Premium benefits below.

  1. Premium library of institutional-level research and analysis, including fundamental stock analysis and advanced market signals on technicals and macro analysis.
  2. Weekly Webinars on advanced market signals and broad market, plus quarterly portfolio reviews on Long-Term Buy and Hold tech stocks.
  3. Technical Analysis on stocks and Broad Markets with charts on all major US markets, analysis of inflation and growth, as well as 60 global markets to help us focus on risk/reward for entries and position our portfolio based on the macro-environment.
  4. An Active Forum made up of a community of like-minded investors with robust conversations including both fundamental and tech product analysis.
  5. A completely Transparent Portfolio made up of long-term buy and hold positions, crypto, and Long/Short Momentum positions.
  6. Trade Alerts are sent directly to your phone via SMS and email.
  7. NEW! Automated Hedge with advanced signals to help spot approaching risk in the markets, with a 67% win rate going back to 2003 with only 40 signals triggered.

Sign Up


About I/O Fund Portfolio Manager Knox Ridley

Knox Ridley began consulting on portfolios in 2007 and is an experienced growth investor in both bull and bear markets, which is hard to find these days. As the portfolio manager of the I/O Fund, he beat the top-performing funds on Wall Street in both 2020 and in 2021. His real-time trade notifications to premium subscribers have garnered 27 entries with over 100% gains in the last two years. Knox began his career as an ETF wholesaler in 2007 before becoming a portfolio consultant for large RIAs, FAs, and Institutional accounts. He is very keen on macro trends and is trained in Fibonacci Trading, Elliott Wave theory, as well as Gann Cycles. He also uses classical technical analysis to manage risk and identify great risk/reward setups. Knox is known for increasing and decreasing allocations for record-breaking returns.

head bg

Get a bonus for subscription!

Subscribe to our free weekly stock
analysis and receive the "AI Stock: 5
Things Nobody is Telling you" brochure
for free.

More To Explore

Newsletter

Aerial view of Tesla's new Model Y Juniper parked in lines. Courtesy of Tesla, Inc.

Tesla Stock Faces Recalibration of Growth Expectations

Tesla’s stock is now facing a recalibration of expectations after Q1’s delivery report missed by a wide margin. Q1’s analyst consensus has gone from $25.98B at the start of the year to $23.97B in earl

April 17, 2025
The bond market could break the stock market in 2025, as explored in ‘The Fed Can’t Save This One’ article.

The Fed Can’t Save This One: Why Bonds May Break the Stock Market in 2025

In early 2025, as markets rallied to new highs, we warned that divergence across key sectors signaled a looming correction. Now, with all major indexes in a technical bear market and bond market dysfu

April 11, 2025
Silhouette illustration of Larry Ellison, Oracle's CTO and executive chairman.

Oracle Stock Outlook: Revenue Could Double by FY2029, yet Targets Seem Lofty

Late in 2024, Oracle outlined an ambitious plan to nearly double its revenue by fiscal 2029, hinging on long-term growth in enterprise AI and cloud spending. Oracle sets itself apart from its hypersca

April 04, 2025
I/O Fund reports a 210% cumulative return, surpassing top tech ETFs and institutional portfolios with a 35% gain in 2024. Source: YCharts and InsiderMonkey.

I/O Fund Reports 210% Cumulative Return -- Ranking Above Wall Street's Best

In 2024, I/O Fund posted a 35% return, significantly outperforming popular tech ETFs, which recorded an 8% return over the same period. On a cumulative basis, the results translate to a remarkable 219

March 31, 2025
Chart showing retail investor losses compared to institutional investors, highlighting market volatility and the impact of high-frequency trading.

The Harsh Truth: Retail Investors Take the Brunt of Market Losses

Retail investors face significant disadvantages in the stock market, often underperforming institutional investors by a wide margin. Studies show that high-frequency trading firms dominate market acti

March 28, 2025
Illustration of a futuristic AI data center featuring NVIDIA’s GB200 Superchip

NVIDIA’s GB200s for up to 27 Trillion Parameter Models: Scaling Next-Gen AI Superclusters

Supercomputers and advanced AI data centers are driving the AI revolution, enabling breakthroughs in deep learning and large-scale model training. As AI workloads become increasingly complex, next-gen

March 21, 2025
NVIDIA Blackwell Ultra GPU unveiled at GTC 2025, revolutionizing AI and HPC with unprecedented efficiency and power.

NVIDIA Blackwell Ultra Fuels AI & HPC Innovation, Efficiency and Capability  

NVIDIA’s latest Blackwell Ultra GPU, unveiled at NVIDIA GTC 2025, is transforming AI acceleration and high-performance computing (HPC). Designed for the “Age of Reasoning,” these cutting-edge GPUs del

March 21, 2025
Nvidia CEO Jensen Huang discusses AI market dominance at GTC 2025, addressing demand concerns and future growth projections.

Nvidia CEO Predicts AI Spending Will Increase 300%+ in 3 Years

Nvidia has traversed choppy waters so far in 2025 as concerns have mounted about how the company plans to sustain its historic levels of demand. At GTC, Huang threw cold water on many of the Street’s

March 20, 2025
Natural gas pipelines supporting AI data centers as energy demand surges, with Texas and Louisiana emerging as key hubs for AI infrastructure growth.

Why Gas Pipelines Are the Unsung Heroes of AI Data Center Expansion

Natural gas is emerging as the backbone of AI data center expansion, with demand expected to reach up to 6 billion cubic feet per day by 2030. As AI-driven infrastructure surges, data centers are turn

March 19, 2025
AI data centers are driving the AI revolution, but their soaring energy demands pose sustainability challenges. With power consumption projected to rise 160% by 2030, data centers are integrating brown, clean, and renewable energy sources. Goldman Sachs predicts 40% of new capacity will come from renewables, but can solar, wind, and nuclear sustain AI’s 24/7 operations? Explore how hyperscalers are evolving their energy strategies to meet growing AI demands.

AI Data Center Power Wars: Brown vs. Clean vs. Renewable Energy Sources

AI data centers are at the heart of the AI revolution, but their massive energy demands raise critical questions. With power consumption expected to grow 160% by 2030, data centers are turning to a mi

March 19, 2025
newsletter

Sign up for Analysis on
the Best Tech Stocks

https://bethtechnology.cdn.prismic.io/bethtechnology/e0a8f1ff-95b9-432c-a819-369b491ce051_Logo_Final_Transparent_IOFUND.svg
The I/O Fund specializes in tech growth stocks and offers in-depth research for Premium Members. Investors get access to a transparent portfolio, a forum, webinars, and real-time trade notifications. Sign up for Premium.

We are on social networks


Copyright © 2010 - 2025