There are three lines in the chart, one is S&P500, one is the US 10-year treasury yield, and one is the 3-month treasury yield.
In the past, the SPX usually lead the 3-month yield is falling. This means Fed will cut interest rates aggressively when the market turns into a downtrend. However, it's different this time. The S&P500 had a low in Oct 2022, and the Fed continued to rate hike afterward, which means the Oct low is not low enough to scare the Fed from a rate hike. In the chart, not until something breaks the Fed would not start a rate cut.
We will challenge the Oct low and even lower until the Fed changes its mind. Expecting more rate hikes, lower S&P500.
In the past, the SPX usually lead the 3-month yield is falling. This means Fed will cut interest rates aggressively when the market turns into a downtrend. However, it's different this time. The S&P500 had a low in Oct 2022, and the Fed continued to rate hike afterward, which means the Oct low is not low enough to scare the Fed from a rate hike. In the chart, not until something breaks the Fed would not start a rate cut.
We will challenge the Oct low and even lower until the Fed changes its mind. Expecting more rate hikes, lower S&P500.