Charts I’m Watching: May 17, 2018

TNX reached 3.11 this morning, but DXY isn’t buying it.  We asked rhetorically, yesterday, whether “investors algos [will] even care about the stagnation which, abetted by inflation-driven higher interest rates, has ensnared the economy in its razor sharp talons?  Or, will a tumbling ‘risk indicator’ and copious share buybacks be enough to ward off a … continue reading →

No Free Lunch

While a higher dollar might help mitigate inflation, higher interest rates are starting to bite. Both mortgage refinancing and housing starts and permits tumbled in April. Futures tumbled about 5 points on the news.  But, even that was a problem, as SPX is perched precariously atop the critical support of its 2.24 Fib extension at … continue reading →

Not so Fast…

Higher interest rates and inflation, but falling retail sales?  Not a great combination for equities.  In fact, it feeds right into our base case of stagflation.Not even the venerable VIX gimmick was able to paper over the implications.Back on May 3 [see: Decision Time] we identified the 15-16th as a potential new low.  The next … continue reading →

Can Tesla Avoid a Crash?

Take a look at Tesla’s bonds, and you might wonder if the company is careening towards that Great Center Divider in the Sky.  Yet, TSLA stock has held on to some important levels of technical support.  Setting aside the considerable, robust debate and analysis, what do the charts say? I’m a big believer in logarithmic … continue reading →

VIX Dumps: Stocks Jump

There are very few charts which tell the story of this market as dramatically as does VIX’s. The most noticeable pattern is the falling purple channel which accurately signaled its highs and lows between Nov 2015 and Jan 2018.  But, this falling channel conflicted with a much larger rising yellow channel. In the wake of … continue reading →

CPI: The Games Continue

Everyone who drives knows that gas prices increased more than 3% month-over-month  – the official, seasonally adjusted numbers from the BLS in this morning’s CPI report.  Data put together by non-governmental sources confirms it.But, folks like GasBuddy and AAA aren’t responsible for cost of living adjustments for millions of Americans.  So, unlike the BLS, they … continue reading →

PPI Spells Trouble

Another day, another ramp job.  Yesterday’s oil and gas price recovery wasn’t enough to help stocks break out.  But, VIX’s dip below horizontal support was more than up to the task.There’s just one problem – inflation. Ignore the seasonally-adjusted PPI poppycock and look beneath the hood.  Petroleum products rose 21.7%.  That was an understatement, but … continue reading →