Mike Zigmont, author of the Zigmont Report, is a partner at New York-based Harvest Volatility Management, a hedge fund with over $12B AUM, offering volatility management solutions to its investor base worldwide. Mike has been publishing his daily newsletter (Monday-Friday) privately for the firm’s investors and his personal contacts in the investment business since 2008, sending it daily shortly after the market close.
The opinions expressed below are my own and do not necessarily represent those of Harvest Volatility Management, LLC.
Mood change. Investors are swimming around in a little bit of pessimism lately. In the past, these bouts of negativity were brief. They reversed quickly as well. Is that what’s in store in the near future?
Obviously the permabulls think so. History is on their side too. The negativity of the week is curious. There’s no particular item in the news to point to. The best guess for the change in mood is simply that July & August were so bullish, this is just a pause/pullback before the next leg higher.
Tomorrow we learn the August nonfarm payrolls data (+193k est vs +157k prior).
I don’t think the number really changes much but everyone will watch it and comment on it nonetheless. Revisions have tended to be large lately while the number itself has been a bit light. That’s been a bullish recipe. Given the dip of the week, it wouldn’t surprise me if that’s the match that lights the fire under the dip-buyers behinds.
Right or wrong, it feels like we’re all just waiting for the bulls to reassert themselves.
See you tomorrow,