| | | LOW CONSUMER SENTIMENT AND AN INCREASE IN LARGE RETAIL BANKRUPTCIES SUGGEST A RECESSION IN 2022
As of last Friday, everything looked bearish with all the negative chart patterns, both the daily and weekly chart patterns...
Then yesterday the market seemed to have reversed nicely with solid back to back bars, this was definitely impressive...
But now again, this morning we find the same back to back bars in reverse confirming last Friday's longer term bearish patterns...
One has to be suspicious, very obviously, since this isn't typical bullish behavior...
I get numerous emails every day for more than a month or two from big store retailers announcing they're having a big discount sale, a blow out sale, a clearance sale, a pre black Friday sale, and so on...
I can't believe I'm the only one who gets these kinds of emails...
Black Friday sales were not as they had hoped...
The supply chain problem is being aggravated with bye-dumb's lunatic policy that you can't go back to work if you're not vaccinated...
There are two charts below...
1. Consumer Sentiment
Consumer confidence is at an all time low, here's the data from the University of Michigan...
Consumer confidence today is lower than it was at the peak of the pandemic...
It's not that these stores don't have the inventory, they have their shelves stocked with items but the consumer isn't buying...
Also, the U.S. Dollar is still getting stronger even with lower rates... with a stronger dollar our buying power should increase and cause the trade deficit to increase, but the trade deficit is actually getting smaller, this means that our overseas sales are decreasing and not increasing...
2. Bankruptcies
I suspect the news for 2022 will be the increased number of large retailers closing stores and going bankrupt...
Here's a chart history of retail bankruptcies and these are not the mom and pop stores, these are large retailers with more than $50 million in liability...
Not one word in ANY news media outlet even mentioning the rapid increase in large retail bankruptcies...
I'm not sure how these market will respond to all this data, I'll just follow the signals, but it surely looks to me that a full blown recession is right around the corner...
Powell could keep rates near zero and hold these markets up to some degree, so these markets could still push higher, we'll see...
The current action in the bond market is confirming this...
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