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Please enjoy this updated version of weekly commentary from the Reitmeister Total Return newsletter. Steve Reitmeister is the CEO of StockNews.com and Editor of the Reitmeister Total Return.
Click Here to learn more about Reitmeister Total Return

The stock market (SPY) has been up, down and all around since last week’s commentary. That’s because bulls and bears are slugging it out for dominance during this “Dazed & Confused” phase for the market.
What does that mean?
What happens next?
What should an investor do about it?
We will explore the answers for each of these pressing questions in this week’s Reitmeister Total Return commentary.
Market Commentary
Now let’s a step back to last week’s commentary where I outlined 4 possible outcomes for the market after the very important Fed rate announcement on Wednesday 2/1. Indeed, we landed on the least of attractive of which. That being…
Scenario 4: Dazed & Confused
“This is where the Fed gives mixed signals. Still hawkish for a long time to save face given previous statements. And yet do tip their hat a little to moderating inflation.
This gray area leads to a trading range until investors have more facts in hand. I suspect that 4,000 is the low end with 4,200 at the high end. This comes hand in hand with a ton of volatility as each new headline has investors recalibrate the bull/bear odds.”
The market since then has lived up to ever single syllable of the above expectations. Especially the part about the volatility that comes after every key headline.
Raging higher after the speech.
Tumbling down Friday & Monday after unemployment report came in WAY TOO HOT pointing to the need for the Fed to stay vigilant against inflation a good while longer.
And then raging higher again today after Chairman Powell’s interview at The Economic Club of Washington D.C.
Watch it here if you like, but to me he just reiterates the point that inflation is too hot and the aforementioned employment report only confirmed that notion. This prompts him to keep rates elevated for much longer than most investors appreciate.
Heck, he even stated that this surprising strength may lead them to be even more hawkish than previously stated. Perhaps that means higher than 5% rates. And perhaps it means they will be at it longer than the end of the year. Perhaps both.
These ideas are very hawkish, increasing the odds of recession, making the Tuesday rally borderline insane. But then again, such was the oddity of the reaction last Wednesday when he said virtually identical things.
Looking ahead the main headline catalysts for stocks will be the following:
2/14 Consumer Price Index
2/15 Retail Sales
2/16 Produce Price Index
That means there is a bit of calm before the next headline storm and thus expect stocks to keep banging around in the 4,000 to 4,200 range for the S&P 500 (SPY) til then.
What is so special about 4,200?
The official definition of a new bull market is when you rise 20% from the lows. In this case the lows from October were 3,491 x 20% = 4,189…which basically equates to 4,200.
Note how we flirted with that level a few times this past week only to find too much resistance.

Here is our game plan from here…
Right now, I see a 65% chance that we devolve back into bear market making new lows in the months ahead. But 35% chance of a soft landing that makes way for the next bull market.
This explains why the Reitmeister Total Return portfolio is currently 36% long the stock market with a blend of Risk On and Risk Off positions.
If and when the bear market comes back with a vengeance, as likely signified by a break back below the 200 day moving average (3,947), then we will get back into our bearish hedge that so successfully gained nearly 7% from August 2022 through year end as the overall stock market slumped.
On the other hand, if instead we break above 4,200 in a meaningful way, then the odds of bull market will have increased…and we will want to come along for the ride by moving up to 50-60% long the stock market. The new additions should be of the Risk On variety (growthy companies at discounted prices with impressive POWR Ratings).
I will end by sharing this analogy.
The investment journey is often like going around a Grand Prix race track. Lots of twist and turns that make us become cautious and slow down. But right after the turns comes the straightaway where we can put the pedal to the metal with greater confidence.
Indeed this is a heck of a tight turn right now as we could break north with bull market or get back on the rougher bearish detour. So hold onto the steering wheel tight right now as there is likely a straightaway on the way that will make our lives easier…and our wallets fatter.
What To Do Next?
Watch my brand new presentation: “Stock Trading Plan for 2023” covering:

Why 2023 is a “Jekyll & Hyde” year for stocks
How the Bear Market Could Come Back with a Vengeance
9 Trades to Profit Now
2 Trades with 100%+ Upside Potential as New Bull Emerges
And Much More!

Watch “Stock Trading Plan for 2023” Now >
Wishing you a world of investment success!
Steve Reitmeister… but everyone calls me Reity (pronounced “Righty”)CEO, StockNews.com & Editor, Reitmeister Total Return

About the Author
Steve is better known to the StockNews audience as “Reity”. Not only is he the CEO of the firm, but he also shares his 40 years of investment experience in the Reitmeister Total Return portfolio. Learn more about Reity’s background, along with links to his most recent articles and stock picks.

The non-farm payrolls report released last Friday dropped a bombshell on the market, revealing the US economy added 517K jobs in January 2023, surpassing expectations of 185K and the highest since July 2022.
Growth was seen in leisure and hospitality, professional and business services, health care, government, retail trade, construction, transportation and warehousing, and manufacturing. Despite tech layoffs and potential economic slowdown, the labor market remains tight, with November and December job numbers revised higher.
This was a real shocker that caused huge, unexpected waves of volatility in the markets. Let’s have a look at 1-day futures performance last Friday in the diagram below. It looks like a red sea with a small island covered in green grass.
Chart courtesy: finviz.com
Gasoline, silver and platinum were the ultimate losers that day with massive losses of -5.3%, -5.2% and -5.1% respectively. Gold futures lost huge -2.8% as well. Palladium futures price plummeted -1.8%. Among metals, Copper futures were the most resilient at -1.5%.

The U.S. dollar index definitely took center stage. High hopes for a soft landing for the Fed, supported by a robust labor market, fueled huge demand for the dollar as a rate hike, potentially larger than 0.25%, seems imminent. The DX futures gained +1.2% last Friday.
Last month, I shared my thoughts about the future of the dollar in the post titled “Is Dollar’s Dominance Over?” covering both technical and fundamental factors. The former has shown the bearish scenario and the latter has highlighted the bullish potential.
The majority of readers voted that “the dollar has already peaked”.

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In fact, the 50-day moving average crossed below the 200-day moving average right after the last article about the dollar was published, triggering the bearish “Death Cross” pattern. The dollar index futures have lost almost 3% since that post.  
Last Friday, the DX futures reversed to the upside closing above two earlier small peaks at $102.8. How far it could go to the upside? Let me show you in the quarterly chart of dollar index futures below.
Source: TradingView
This map above was shown to you almost four years ago, on a distant date in 2019.
At $114.2, it reached the preset target set last year located at the same distance as red leg 2 in blue leg 2. The upside of the purple uptrend channel was also there offering a double resistance. At that exact spot, the DX futures reversed and lost quite a bit of value from $114.7 to $100.7, lowest point last week.       
There are two possible paths for the upcoming price move.
Essentially, the red path within the zigzag indicates the possibility of a correction following the first move down that occurred recently. It could reach the “golden ratio” of 61.8% Fibonacci retracement level first at $109.4 ahead of the following massive drop to retest the low of 2008 at $71.1.

There are two interim support levels on this path. The first one, located near the $99 handle, is at the bottom of the purple uptrend. The second one is in the valley of a large consolidation around $89.2, preceding the final rally.
The blue path has two targets marked by blue up arrows. The first target, $114.7, is to retest the former top if the Fed raises interest rates past 5% and inflation slows. The second target, $121.3, is the 2001 peak and requires higher demand for the dollar, potentially from a higher real interest rate or a major geopolitical event.

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Intelligent trades!
Aibek BurabayevINO.com Contributor
Disclosure: This contributor has no positions in any stocks mentioned in this article. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

Please enjoy this updated version of weekly commentary from the Reitmeister Total Return newsletter. Steve Reitmeister is the CEO of StockNews.com and Editor of the Reitmeister Total Return.
Click Here to learn more about Reitmeister Total Return

Why are so many investment experts still calling for a bear market?
And just as interesting…why are so many equally talented investors saying the new bull market is already here?
Because investing is an inexact science leading some to rely on economic data…while others prefer to read the charts…or the expression on Powell’s face… or astrology signs or….(fill in the blank with the nuttiest thing you can think of).
So what is an investor to do when there are so many well-reasoned opinions that are giving such contradictory conclusions?
That will be the focus of this week’s commentary.
Market Commentary
I believe the best way to tell this story is from a very personal place. That being where I have an Economics degree and most certainly diagnose the market from a fundamental point of view.
Early on in my career I used to make fun of chartist for playing the market like a video game instead of taking it more seriously with fundamentals. Yet that was quite foolish on my part as I have come to greatly respect many of the leading chartist like Kevin Matras of Zacks and JC Parets of AllStarCharts.com. There is simply no denying their keen insights on market direction.
Now let’s move the conversation forward to Wednesday’s Fed meeting. I was already bearish beforehand…as are the majority of market commentators at this time. And I became even more bearish after the announcement. Amazingly, others saw it differently as stocks 3% from the time of the speech into Thursday’s close.
I went to bad Wednesday night angry, confused, dejected, perplexed, and downright flummoxed.
But then something dawned on me in the early hours and could not get back to sleep. This led to the following trade alert that I sent out to Reitmeister Total Return members on Thursday morning.
I have edited it for the purposes of our conversation today and will follow it up with some additional notes.
[Trade Alert] Less Stubborn Steve
As you likely understood from last night’s commentary, there is no way for me to watch Chairman Powell’s speech yesterday and not be firmly bearish. Keeping hawkish policies in place through the end of the year + 12 months of lagged effects + very weak economic data at the moment = ample window to create recession w/ job loss and lower stock prices in the months ahead.
On the other hand, I want to share with you this conversation from a month ago that haunted me all night leading to this morning’s email. I was asked to provide an answer to the following question:
What’s one lesson you learned in 2022 that you’ll take with you into 2023?
To which I answered: “I finally got bearish in May with the market closer to 4,100. Earlier than most…but later than it needed to be if I focused on the clear break below the 200 day moving average in April around 4,500. Acknowledging that proven signal would have improved my results and will be mindful to heed that warning in the future.”
The only way to rectify these 2 opposing positions is to strike a middle ground. To become less bearish in our portfolio to enjoy more upside if the bulls are correct with their recent rally above the all important 200 day moving average.
Just as important is not becoming so bullish as to have the rug pulled from us on a future date when the economy could tip over into recession with stocks descending once again. The solution is to make the following trades that move us to 36% long the stock market from the previously 0% long bearish hedge.
(trade tickers reserved for Reitmeister Total Return members)
…I could have accomplished the task with many different combinations of trades. So don’t spend too much time thinking about that. If you see another path to get to the same destination then take it. The key is that we are no longer totally bearish. We are now a shade bullish.
If the wisdom of the bull rally grows larger, we will keep ratcheting up our bullishness in the portfolio. Mostly with stocks with top POWR Ratings. Whereas, if we break back below the 200 day moving average, then we will get back in our defensive bearish hedge once again by selling (Risk On assets) and adding back appropriate inverse ETFs.
I absolutely can be a stubborn person with strong convictions. And it would be easy for me to remain bearish given the economic facts as I perceive them.
However, I am also open minded enough to realize when I am being a hypocrite and going against sound logic. (like ignoring the time tested benefits of 200 day moving average breakouts). That is why this is the prudent move that gives us plenty of flexibility to change in the future.
Heck, if the bear market started back in earnest this afternoon…then at only 36% long we would lose a lot less money than most. And as we crossed back over the 200 day moving average reverting back to our bearish hedge would have us producing profits as the market descended lower. That is not so bad for a “worst case” scenario.
However, if the wisdom of the crowd creating this rally is indeed correct, then we will be glad that we started to participate in the upside at this stage instead of much later.
In closing, I want to share this valuable lesson.
The investing world is rarely straight forward. That is why there are so many incredibly intelligent players who have well reasoned views that are 180 degrees opposite of each other. Thus, at its most confusing moments it is often wise to strike a balance as we are doing today.
It is better to be partially right than 100% wrong!
As time rolls on, and greater clarity emerges, it becomes easier to shift to the wisest course of action. For now, we will straddle the bullish and bearish camps by making the 3 trades above. No doubt there will be more trades to come.
Let’s stay nimble with our thoughts and swift with our actions.
(End of 2/2/23 Reitmeister Total Return trade alert)
Taking back to the top…there are many sound opinions from a myriad of seasoned investors. In the end some will be right and others will be wrong.
Your challenge is to determine what to do now.
If you are like me…and realize there is competing sound logic, then you do not have to make a binary, yes/no decision. You can find a nuanced approach that provides appropriate balance.
Just remember you are not married to whatever approach you chose. That’s because your investment strategy should be ever evolving.
Not just about being bullish vs. bearish. But also considering if it is time for…
growth vs. value
large caps vs. small caps
what sectors are hot vs. which are not
I have looked in the mirror and made an appropriate change in my strategy. Time for you to do the same.
What To Do Next?
Watch my brand new presentation: “Stock Trading Plan for 2023” that will help you assess the full bull vs. bear case to create the right trading strategy. It covers vital topics such as…
Why 2023 is a “Jekyll & Hyde” year for stocksHow the Bear Market Could Come Back with a Vengeance9 Trades to Profit Now2 Trades with 100%+ Upside Potential as New Bull EmergesAnd Much More!
Watch “Stock Trading Plan for 2023” Now >
Wishing you a world of investment success!
Steve Reitmeister… but everyone calls me Reity (pronounced “Righty”)CEO, StockNews.com & Editor, Reitmeister Total Return

About the Author
Steve is better known to the StockNews audience as “Reity”. Not only is he the CEO of the firm, but he also shares his 40 years of investment experience in the Reitmeister Total Return portfolio. Learn more about Reity’s background, along with links to his most recent articles and stock picks.