Market on the Precipice of Greatest Bear Trap or The Acceleration

The 2018 correction ended after the Federal Reserve ended rate hikes, not when it ended QT. The latter continued until September 2019, when the repo crisis hit and forced the Fed off QT.

High-yield credit spreads are widening again. Can't say for certain how much going by the various funds, but treasuries are up today and junk bonds are down. That is a recipe for a credit event if it goes on for a few more days.

Remember when the Federal Reserve cut rates even though oil was soaring? The Fed will lose its inflation fixation very quickly.

The Russell 2000 Index went below its January 2020 peak today and made a new low. It is fighting around that level in the afternoon. NQ and ES are in broadening formations. The break out of the pattern should signal the short-term direction. NQ is also battling around the inverted H&S neckline.