Meta Strategy Trading Portfolio – Probability Map Update.

Rally Peak?

With the current rally cresting a good week ago, the S&P fell back below its 20 dma last Tuesday and broke the steep upward channel from the October low on Friday.

This turn happened uncannily right where it was supposed to: At a falling trendline connecting the major highs of 2022.

Two major factors pose the greatest upside risk currently:
a) Strong seasonality with the Santa Claus rally period starting December 22nd.
b) Next week is filled with events that can drive the market any which way.

But, my base case recession scenario remains in place with fundamentals unequivocally pointing the way.