Currently the stock market sentiment can not be worse. CNN Greed & Fear Index stays at 6. This is rock bottom.
What could change this pessimistic investors sentiment? I see three kick starters for sentiment to change and stocks to rebound.
1. A Republican win in midterm elections.
2. The Fed realises it is ahead of the game and could pause or slow down its planned interest rate hike activity.
3. A solution of Trump’s trade war against China and the rest of the world.
None of these kick starters will appear tomorrow. Polls show that a Republican win would be a surprise. Trumps shooting against the FED might want them to prove they are independent and continue with their plan and China, Russia and the rest of the world is already preparing for a longer term trade battle.
So, get prepared for a choppy road ahead but with a good plan and strategy you will end up on top!
Sven Franssen