Chief Macro Strategist
Summary: We are at the end of the post-pandemic policy cycle and this brings with it the potential for a period of significant transitional volatility. This article is an abridged set of points looking at the evidence that the broader market is at risk of rolling over significantly in coming days and weeks and what investors can do to generally risk market exposure.
Note: this is an abridged version of a far longer article – see the original article for more background, charts and additional charts.
What: this market is set up for a potentially very significant correction (baseline of 10-20% given the magnitude of the recent draw-up) in the coming weeks as the post-pandemic policy cycle is coming to an end and already reversed for some countries. We may be early and /or wrong, but a cascade of developments and forward concerns have us on edge here. Please keep in mind that this article is meant to provide some food for thought rather than serve as a recommendation for action.
Evidence
Ways to reduce risk
In any case, be careful out there.
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