Kamala’s poll numbers are crashing, and the Dems are in a panic

In the world of investing, there is one thing that’s certain; Political uncertainty adversely affects capital investments.

In the month prior to most Presidential elections, it’s not uncommon for us to hear commentators talk about the “October Surprise”. History shows that these surprises generally show up in the form of late-breaking political bombshells, orchestrated in the hopes of influencing the result of an election.

When it comes to investors, they do not like surprises and they do not respond well to uncertainty, whether it be economic or political.

If you listen to U.S. Rep. Jamie Raskin, (D-Md.), he is already planting the seeds of what could be a real insurrection, and it will be interesting to see if this develops into a narrative for the left. Should Donald Trump win his place back into the White House, Raskin’s plan is to disqualify Trump on January 6th which, in his own words, could lead to “Civil War Conditions”. While I don’t believe this will happen, it certainly won’t make investors happy if they try to pull such a stunt.

On the international front, we are also faced with an escalating war in Israel, as the US deploys THAAD missile defense systems along with troops to the region.

So, there you have it… Uncertainty times 2.

Below is a monthly candle chart of the S&P Equal Weight ETF (Ticker: RSP)

The price divergence from the 20-month simple moving average is quite wide. This tends to be a bearish signal as the chance of a pullback to the SMA becomes greater. While the stochastic and CCI are in overbought territory, the Commodity Channel Index is showing a negative divergence. Negative divergences are defined by higher price highs coupled with lower highs on the CCI. This is an extremely bearish reading.

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