There are a lot of mixed messages from the market, although, the overall narrative of a weak market vulnerable to sharp selloffs remains firmly intact.

Wall Street continues to look to short rallies, as the overarching belief is that retail investors should pay a heavier price. Much of this is bluster and deflection from the awful performance of the street.  Of course, the more stocks go down from here the greater the attraction. I find it remarkable there are suggestions for long term investors to sell stocks like Apple (AAPL) and Microsoft (MSFT) with the notion everyone will turn around and buy at the exact bottom. 

I do not buy that true market investors managing big money are selling bounces – on the contrary, I’m sure they are building positions.

The devastation has been immense this year, and we are going to see the majority of these names higher in a year, but many are going to be much higher.

Glimmer of Hope?

Friday was a strong session, but a look at new highs and lows remains astonishing.  Only 25 names posted new highs.

The street is pulling back on the intensity of Fed rate action. N ow its 50 bps hikes not 75 bops.

Bad News = Good News

This morning, the Empire Manufacturing report was a huge miss: -11.6% consensus +15.0%.  This is what the Fed wants to see.

Portfolio Approach

There are not sector weighting changes this morning in our Hotline Model Portfolio.

Today’s Session

Keep an eye on the VIX, which continues to drift below that 30 read. The street wants it to get above 40.