The prior week’s Friday rally on tame employment data (“good” – for the economy, but not “too good” – as to trigger more interest rate increases) continued as prices rose modestly throughout the week. The only hiccup was some profit-taking on Friday by the same nervous investors afraid that a big recession is just around the corner. 

Investors remain in two camps: a) those who see inflation declining, allowing the Fed to discontinue rate increases and thus avoid a severe recession, and b) those who still expect a commercial real estate collapse that will lead to widespread unemployment and severe recession. 

Right now, the former sentiment is prevailing, and will until – and if – economic data warning signs emerge. Friday’s selling was not due to any such warning signs, just profit-taking by the usual amateur investors who lack conviction, not the institutions. 

Many of our positions extended long gains, though modestly. Shorts were mostly neutral. Because institutions were not among the sellers, very few trades again this week. 


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