Watching this administration operate the markets, I sometimes get the feeling they’re trying to throw the game. Witness Mnuchin’s bizarre announcement that everything is fine, there are no liquidity issues, I’m going to convene the PPT just for the heck of it.
It’s akin to bursting into a crowded theater and screaming at the top of your lungs “don’t worry, there’s no fire!” Sure, some might reach for another handful of popcorn. But, to be sure, many would at least look around and sniff the air more carefully. And, at least a few would make their way toward the exits just to be on the safe side.
Futures are currently off 14 points on what might otherwise have been a typical maintenance-mode Christmas Eve.But, that’s not the problem. After reaching our latest downside target on Friday, SPX closed below support. And, this morning, USDJPY and TNX have broken down. VIX, which already broke out last week, is threatening another breakout. This is no way to run a rescue operation.
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