The bull market is undergoing a serious questioning period as we enter 2022. And for good reason.
The S&P 500 Index and Nasdaq Composite have more than doubled since the 2020 coronavirus lows and the bull market is nearly 13 years old since the 2009 financial crisis lows.
BUT the bull market is still very much alive and many speculators have gone broke betting against it.
Today we discuss two key variable that have investors concerned about the potential of a correction or worse this year: 1) Growth stocks are stumbling with rising rates and a stronger US Dollar 2) Volatility is percolating and appears to have broken a series of higher lows.
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$VIX Volatility Index “weekly” Chart
Value stocks are beginning to assert themselves as a number of caution indicators emerge – strong dollar, higher bond yields, geo-political strife, inflation, and mid-term elections. Could 2022 be the year value stocks out-perform? Chris Kimble discussed this here.
That said, another indicator is causing some concern. The VIX Volatility Index broke a series of lower highs with a spike in early December. Could this also be signaling a period of increased volatility and caution ahead?
Twitter: @andrewnyquist
The author may have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
