While the parties retreat to their corners and refine their talking points, markets got off to a very strong start in Q4. At some point, someone will pay a political price for shutting down the government. But, both parties are betting they’ll prevail. And, for now, the algos are making hay.
Indices are happy to focus on AI and semis. And, past shutdowns have been non-events from an investment standpoint. Our analysis of shutdowns over the past 25 years:
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Both ES and SPX seem content to inch higher on the underside of rising resistance.
We’ll keep an eye on USDJPY and DXY which are teetering on TLs of support.
Meanwhile, CL and RB continue their selloff, with RB nearly to our 1.8545 target.
TNX continues to weaken, though the 2s10s is still hanging around 55 bps.
continuing…