As the S&P500 will likely deliver the worst 1st half performance since 1970, the investors #sentiment measured by AAII, is reaching very high bearish readings. At some point this reading becomes action, with indiscriminate selling and portfolio derisking. This sentiment is being influenced by almost certainty (98%) in the probability of an economic #recession in the US in the next 24 months (source: Bloomberg), high #oilprices and a hawkish #federalreserve that continues to argue (Powell testimony in Congress) that their actions will abate inflation but will avoid an economic recession. In order to change the sentiment, we need either capitulation or confirmation that the fed is capable of fulfilling its mandate.
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Source: AAII, daily shot.
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