Authored by Sven Henrich via NorthmanTrader.com,
Following a very aggressive counter rally off the December lows we remain inside the larger trading range of 2018, other than small pullbacks the Q1 rally remains technically uncorrected, but let’s be clear:
Everybody’s chasing reality here: The US administration, the Fed and Wall Street.
- The US administration promised 3-4% GDP growth and shrinking deficits. Neither is happening, growth is slowing and we just had the largest monthly deficit in US history.
- The Fed went from autopilot on the balance sheet and rate hikes to neither. Key point: They will not tell you a recession is coming and rate cut risk is rising.
- Wall Street predicted continued earnings growth for 2019 now we have an earnings recession at least in Q1 with -3.7% earnings growth a growth estimates for full year 2019 may still be too high.
Given the uniformity of overly positive projections that have turned out not to be true, can everyone simply take a step back and acknowledge some uncertainty here?
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