Squeezing the Bears
S&P 500 rose sharply from the 4,200 intraday lows, but the tech move wasn‘t facilitated by Treasuries rising. Quite the opposite, it‘s as if the risk-on turn in bonds came at the expense of value stocks, which is a little odd. These could have reacted better given the daily hit to commodities, with oil almost hitting $95. It still looks as a false dawn in stocks – however late in the rising yields game we‘re, there is still some more to go, and as I said lately, more room for panic in stocks. Yesterday‘s upswing is thus likely to be challenged. Cryptos look vulnerable to the downside here as well…
Remember, the hiding place in the medium- and long-term is in real assets. These can suffer sharp daily moves, but note that the CRB Index uptrend channel hasn‘t been breached. Neither inflation expectations have been broken. Even the miners setback has been more than partially bought, and FCX is extending the optimistic signal to copper as well. No key level came into jeopardy in oil either, and the high volume is XLE is… speaking volumes. Natgas is also ready to move higher once again. Thus, I think that the dust in commodities and precious metals is slowly settling down, and that we won‘t face too much more downside to soundly invalidate yesterday‘s intraday lows in the nearest term.
Remember, nothing too groundbreaking happened yesterday in the markets. Likewise, look for the USD to still rise, unbroken – just as real assets.
There won’t be a regular analysis featuring charts or Twitter activities today, but I’m keeping a close eye on the markets and will issue a sound commentary whenever required by the markets on my watch. Especially the closing prices and volume of today’s session would be insightful – it’s unlikely we’re making a local bottom in real assets today though.
Thank you for your patience.
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Thank you,
Monica Kingsley
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mk@monicakingsley.co
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All essays, research and information represent analyses and opinions of Monica Kingsley that are based on available and latest data. Despite careful research and best efforts, it may prove wrong and be subject to change with or without notice. Monica Kingsley does not guarantee the accuracy or thoroughness of the data or information reported. Her content serves educational purposes and should not be relied upon as advice or construed as providing recommendations of any kind. Futures, stocks and options are financial instruments not suitable for every investor. Please be advised that you invest at your own risk. Monica Kingsley is not a Registered Securities Advisor. By reading her writings, you agree that she will not be held responsible or liable for any decisions you make. Investing, trading and speculating in financial markets may involve high risk of loss. Monica Kingsley may have a short or long position in any securities, including those mentioned in her writings, and may make additional purchases and/or sales of those securities without notice.
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