Fair value is around 3950ish based on the current macroeconomic data/environment. So, the market is pricing in a "soft landing" at this point.
While it is possible that this happens, it has yet to be seen.
After the PCE data on Friday, the Fedwatch tool for the March meeting raised the chance of 25BPS hike in the March meeting from 79% to 84%. IE inflation is not dead.
The question that is to be answered is how deep the slowdown will be and how far is the Fed willing to go to kill off inflation. JOTLS is very interesting to look at with still over 10M jobs to be filled.
While the bargains were out there in TSLA, AAPL and other tech names just a short time ago, they are simply not as attractive at these price points. I do not see stock prices on sale right now based on the current data.
If the soft landing did happen, these names could not grow into these higher price points, but that is yet to be determined. Being a good investor/trader is about being adaptable and this environment it is crucial to do just that.
IT technicals are favoring some downward action or at least a pause.
Based, on the fact that market is priced to near perfection, I started shorting and will be looking for opportunities on the short side in IT.
Edited by MikeyG, 28 January 2023 - 03:20 PM.