The Fed meets this week. It already shifted its bias from hawkish to dovish, helping stocks. With the economy softening, in due course the Fed may once again deploy balance sheet as a tool, which will initially help stocks, but … Continued
The sharp decline in US stocks last October-December forced the Fed to do a 360 as relates to its campaign to tighten monetary policy. The dovish shift apparently wants to unleash animal spirits. Investors have obliged – thus far. Will … Continued
With higher lows since the December 2015 trough, gold finds itself right underneath major resistance. A breakout would speak volumes about the global economy and how major central banks would react in response. Near-term notwithstanding, gold bugs deserve the benefit … Continued
After the October-December rout, US stocks rallied big in January and February-to-date. Several data points such as consumer and investor sentiment followed suit, but their rise has been muted. For longs, this could mean there is room for more strength, … Continued
Bulls last week defended support at 2600-2630 on the S&P 500, which has rallied massively since bottoming on December 26. Daily conditions are deeply overbought, pricing in a dovish Fed. A two-day FOMC meeting begins Tuesday. A ‘buy the rumor, … Continued
Fundamentals are still a suspect, but US stocks were treated with soothing comments from Fed chief last week. Bulls have the ball, but bears are likely to show up at $260 on SPY. Speaking at the American Economic Association’s annual … Continued
Following futures positions of non-commercials are as of December 11, 2018. 10-year note: Currently net short 393.8k, up 100.6k. Next week – on 18-19 – the FOMC meets. This is the last meeting this year. A 25-basis-point raise is expected, … Continued
SPY last week was rejected at channel resistance, coming up $0.63 short of surpassing the all-time high of $286.63 reached January 26. The path of least resistance is down. A covered put might help. There are interesting dynamics at play … Continued
Arguably, US stocks are giving off some signs of fatigue. The S&P 500 large cap index (2840.35) is still below its late-January high of 2872.87. The Nasdaq 100 index (7395.49) in the week before was rejected at six-month-old channel resistance; … Continued
If the Fed moves in September and December, the fed funds rate will be in excess of core inflation. In a leveraged economy, that should begin to bite. The FOMC dot plot expects three more hikes next year. This is … Continued