Dr. Bickel knows best!

But if history is any guide, we must expect market turbulence before the US election. However, with odds of a first Fed rate cut rising, the outlook for US equities has changed little. Unless the US economy falls into a recession and expected corporate earnings growth significantly slows down — neither of which is currently expected. There are still many positive US leading indicators contradicting the highlighted negative ones.

US bond markets have immediately reacted after the job data release, and yields have dropped. The odds for a September Fed rate cut have risen short-term to around 80% and have only slightly mean-reverted. There are increasing signs that the current Fed funds rate is restrictive and starting to hurt various parts of the economy. Regardless of this, US stock markets closed in the green. Driven once more by large-cap tech, the S&P 500 gained 1.7%, while the Nasdaq 100 set a new record, advancing almost 3%. Meanwhile, in Europe, major markets were also in the green but did not rise more than 1%. In other words, the UK and French elections had little impact. Similarly, the Joe Biden drama has so far been a non-event for the US stock market, which may come as a little surprise.

Nasdaq 100 at a New Record. US Job Report Raises Odds for a Fed Rate Cut in September. Bond Yields Drop. But Will the Fed Fall Behind the Curve? US Job gains exceeding 200,000 last month flattered a report that otherwise indicated the US labour market is quickly cooling off, with the unemployment rate rising to its highest level since November 2021 and wage growth increasing at the slowest annual rate since May 2021. If the reported job creation is later revised down, as has happened previously, the whole report would be weak. The ISM PMI data for both the service and industrial sectors dropped below the growth threshold. Consumer-related indicators and credit card delinquency rates indicate that US consumers are struggling, and the economy is cooling off more rapidly. The Fed might fall behind the curve.

The U.S. job data indicate a slowing economy, leading to falling yields. Equities still need to find their direction, but the first move is up as well.

Bitcoin: Yesterday, many comments were circulating about the possible break of the 200-day average in Bitcoin. Self-fulfilling prophecy... From a purely technical point, the next support lies around 52,000 USD.

Did Bitcoin lose its mojo? Make or break, that is the question.

And here is the antidote to the bull case....

I might have selective hearing/reading as I come across various charts supporting my positive call for July and my cautious outlook for the months before the US election. Lastly, there's the bull case for the year-end. If history is any guide, this might be ahead of us, derived from seasonal patterns. Fingers crossed. 👉 My strategy remains unchanged: stay the course but do not chase the market. Use dips to rebalance the portfolio, as FOMO and YOLO will persist.

When the first half of the year is positive, what happens in the second half? In most cases, markets continue to rise, and setbacks are mild. Let's see if history rhymes once more or not. Stay invested but do not chase the market.