2022 = Twenty-Twenty, Too?

As 2021 drew to a close, the broadly based Wilshire 5000 flashed a particularly long-term sell signal in the form of a negative 14-month RSI divergence. The last time this happened was in August 2018 (see Market top ahead? My inner investor turns cautious). Stock prices continued to rise for another two months before it hit an air pocket. In the past, a bearish event can take as long as a year. What does this mean for stocks in 2022?

The bond market may fare better in the coming year. The Barclays Aggregate Index unusually fell last year and it has never exhibited two consecutive years of negative returns (warning: n=3).

What does this mean for asset prices? Will 2022 be equity bearish and volatile and become Twenty-Twenty Too?

The full post can be found here.