Read the story here. Advertise at Before It's News here.
Profile image
By Political Calculations (Reporter)
Contributor profile | More stories
Story Views
Last hour:
Last 24 hours:

The S&P 500, a Better-Than-Expected Inflation Report, and the Biggest Short Squeeze in Market History

% of readers think this story is Fact. Add your two cents.

In an especially volatile year, the S&P 500 (Index: SPX) continues to provide excitement! The index closed the trading week at 3,992.93, ending Friday, 11 November 2022 up 222.38 points (+5.9%) from the close of the previous trading week.

Getting there involved the thirteenth Lévy flight event of 2022 by our rough count, prompted by a better-than-expected Consumer Price Inflation report, and fueled by what ZeroHedge described as the “biggest short-squeeze on record, based on Goldman’s ‘Most Shorted’ basket”.

For the dividend futures-based model‘s alternative futures chart, we see the new Lévy flight event as a shift in the forward-looking time horizon for investors from 2023-Q1 back toward the current quarter of 2022-Q4.

Alternative Futures - S&P 500 - 2022Q4 - Standard Model (m=+2.0 from 13 September 2022) - Snapshot on 11 Nov 2022

That shift occurred because with inflation being reported lower than expected, the message the Federal Reserve’s interest-rate setting Federal Open Market Committee will send at its upcoming 13-14 December 2022 meetings will carry especial weight for what investors should expect going into 2023.

Going back to the alternative futures chart, we see the level of the S&P 500 is elevated with respect to the trajectory for investors focusing their attention on 2022-Q4. It’s running at the high end of the range the model projects over the next several weeks, which may be the result of noise from the short-squeeze rally.

Given that investors are focusing on 2022-Q4, we need to point out there will be at least one more Lévy flight event before the end of 2022. If that happens during the next several weeks, that means stock prices would fall by a significant percentage. There’s also the wild card factor of the additional noise that has been injected into the market from the short squeeze event. Noise always dissipates, it’s only ever a question of when. In this case, that dissipation will also mean falling stock prices.

Here’s a recap of the week’s market moving headlines:

Monday, 7 November 2022
  • Signs and portents for the U.S. economy:
  • Fed minions say they’re strangling economy even harder than data says:
  • Bigger stimulus developing in China:
  • Bigger trouble developing everywhere:
  • Weakening global demand hurts Vietnam’s garment makers – industry official
  • Euro zone grapples with coordinating energy support plans as recession looms
  • Germany told to pay for Eurozone energy crisis:
  • Central bank minions stuck on rate hikes:
  • ECB minions thought about it, can’t stop, won’t stop rate hikes as they prep for Eurozone recession:
  • U.S. stocks end higher, Meta jumps as investors eye midterms
  • Tuesday, 8 November 2022
    • Signs and portents for the U.S. economy:
  • BOJ minions briefly consider ending never-ending stimulus, JapanGov minions okay more fiscal stimulus:
  • Japan’s cabinet OKs extra budget spending, adding to debt
  • ECB minions excited about hiking rates, embrace their “dark side” as they deal with developing cracks in financial system:
  • Wall Street ends higher as investors eye U.S. midterms
  • Wednesday, 9 November 2022
    • Signs and portents for the U.S. economy:
  • Fed minions admitting rate hikes will cause recession, markets betting Federal Funds Rate will top out at 5%:
  • Fed terminal rate to reach just under 5%, said bond strategists – Reuters poll
  • Bigger trouble developing in China:
  • ECB minions say higher inflation is still coming to Eurozone despite their rate hikes:
  • Wall Street drops after midterm election, CPI in focus
  • Thursday, 10 November 2022
    • Signs and portents for the U.S. economy:
  • Fed seen slowing rate hike pace as inflation eases
  • Fed’s Logan: Inflation data a ‘welcome relief,’ still long way to go
  • Bigger trouble developing in China:
  • Central banks thinking they can should start backing off rate hikes:
  • BOJ minions thinking about ending never-ending stimulus:
  • ECB minions want more rate hikes, starting to worry about Eurozone bank’s potentially failing:
  • ECB’s Enria calls time on era of big bank buybacks
  • ECB to lend out more of its bonds to ease market squeeze
  • Wall Street soars on sign of cooling inflation
  • Friday, 11 November 2022
    • Signs and portents for the U.S. economy:
  • Fed minion says more rake hikes coming despite worry about overtightening sending economy into recession:
  • Bigger trouble developing in the Eurozone:
  • Bigger trouble developing in China:
  • BOJ, JapanGov minions thinking about ending never-ending stimulus in face of inflation:
  • ECB minions thinking next rate hike may be smaller, Eurozone inflation may be higher:
  • Nasdaq, S&P 500 end sharply higher, fueled by inflation optimism
  • With the lower-than-expected Consumer Price Inflation report, the CME Group’s FedWatch Tool still has a half point rate hike on tap for 14 December (2022-Q4). But in 2023, the FedWatch tool now projects two quarter point rate hikes, in February and March (2023-Q1), with the Federal Funds Rate reaching a peak target range of 4.75-5.00%. Looking further forward, the FedWatch tool anticipates two quarter point rate cuts in 2023-Q4 (November and December) as developing recessionary conditions take hold in the U.S. economy.

    Meanwhile, the Atlanta Fed’s GDPNow tool‘s projection for real GDP growth in 2022-Q4 rose to +4.0% from last week’s +3.6% estimate. There continues to be a big gap between its current projection and the so-called “Blue Chip consensus” that anticipates near zero growth in 2022-Q4.


    Before It’s News® is a community of individuals who report on what’s going on around them, from all around the world.

    Anyone can join.
    Anyone can contribute.
    Anyone can become informed about their world.

    "United We Stand" Click Here To Create Your Personal Citizen Journalist Account Today, Be Sure To Invite Your Friends.

    Please Help Support BeforeitsNews by trying our Natural Health Products below!

    Order by Phone at 888-809-8385 or online at M - F 9am to 5pm EST

    Order by Phone at 866-388-7003 or online at M - F 9am to 5pm EST

    Order by Phone at 866-388-7003 or online at M - F 9am to 5pm EST

    Humic & Fulvic Trace Minerals Complex - Nature's most important supplement! Vivid Dreams again!

    HNEX HydroNano EXtracellular Water - Improve immune system health and reduce inflammation.

    Ultimate Clinical Potency Curcumin - Natural pain relief, reduce inflammation and so much more.

    MitoCopper - Bioavailable Copper destroys pathogens and gives you more energy. (See Blood Video)

    Oxy Powder - Natural Colon Cleanser!  Cleans out toxic buildup with oxygen!

    Nascent Iodine - Promotes detoxification, mental focus and thyroid health.

    Smart Meter Cover -  Reduces Smart Meter radiation by 96%! (See Video).

    Report abuse


      Your Comments
      Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

      Load more ...




      Email this story
      Email this story

      If you really want to ban this commenter, please write down the reason:

      If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.