The S&P 500 posted a three-week win streak. Retail traders checked their accounts. They felt something they mistook for competence.
Markets sat near all-time highs, which is where markets sit when they're not sitting somewhere else. Stock futures barely moved. This qualifies as news because someone needed to fill a webpage before lunch on a Tuesday.
The win streak means the index went up three weeks in a row. Not the same amount each week. Not for the same reasons. Just up. A technical analyst could draw seventeen different patterns on this chart and confidently explain eighteen different outcomes. I could do the same thing with a Rorschach test and a magic marker.
Here's what actually happened: prices moved right for three weeks while occasionally moving up. Some stocks went down. Nobody wrote articles about those. The aggregate number got bigger because more stocks went up than down, or the ones that went up were fatter than the ones that went down, or Jupiter aligned with Mars and retail traders finally read an entire Investopedia article without getting distracted.
The headline contains the phrase "little changed." That's financial journalism for "we have nothing to report but we report anyway." Futures moved less than the margin of error on your bathroom scale. Every talking head on television will explain why this matters. It doesn't.
Markets were near all-time highs last month. They'll probably be near all-time highs next month because that's what markets do over time. They go up, sometimes in streaks, sometimes not. The three-week detail is as meaningful as counting how many times you blinked during breakfast.
Some guy in Wisconsin just placed a market order after reading this headline. He thinks he spotted the trend. He's pricing out jet skis. The market will take his money with the same indifference it showed the previous ten thousand guys pricing out jet skis.
Photo by Maxim Hopman on Unsplash
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