Who? What Are You, an Owl?

The major indices are pushing higher yet today as we head into President Trump's address to the nation tonight at 9pm EST about the war in Iran. While there is much conjecture regarding about what, exactly, he will say, the last two sessions have driven home the point that markets (stocks up and oil down) are hopeful for a relatively fast, clean, and peaceful exit. That may very well be wishful thinking, though, as the Strait of Hormuz remains nearly impassable, at least for ships related to the United States. 

And even if bulls get their clean exit scenario, the damage may have already been done, not just with respect to oil but also the various chemicals which flow through the Strait on a daily basis and are integral for our modern way of living. We also have a three-day holiday weekend coming up, with markets closed for Good Friday. One could see a scenario where Trump gives a final ultimatum to Iran to strike a deal by Good Friday. But, again, Iran seems to be comfortable calling Trump's apparent bluffs up until this point. 

On that note, below the surface the market rally is not particularly overpowering. As an example, the beaten-down software stocks in the IGV ETF are red as I write this. Frankly, given the relief rally of stocks the last two days the software names should be taking liberties to rally sharply. So, it seems like a red flag for them to sit out today. 

In addition, as seen on the second daily chart, below, the private credit names continue to flounder in strong downtrends. Blue Owl is actually below yesterday's lows and threatening to commence a fresh leg lower, as you can see on the OWL chart. Once again, charts which fail to bounce when they have every reason to are often signaling something is uniquely wrong. 

On the first daily chart, below, the Magnificent 7 ETF is retracing up to the scene of its mid-March breakdown around $60. I do not see much evidence of a meaningful bottom yet, despite how quickly sentiment seems to be onboard for just that now.