pebblewriter

Posts

  • Powell: “Buy Stocks and Bonds”

    Okay, he didn’t actually say that. But, he might as well have. His latest press conference was completely devoid of any hawkish sentiment. Not only did SPX shoot up past our year-end target… …the 10Y plunged to our downside target.The message was clear. Interest rates are coming down and the Fed’s third mandate (higher stock prices) is officially in play, with all-time highs are right around the corner.  But, are they?

    We don’t wish to sound negative, so we’ll let Goldman Sachs’ 2024 Equity Outlook do it for us. Stocks might be near record highs, but it’s really just the magnificent 7 which are reaching rarified air. The rest…not so much.

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  • FOMC Decision: Dec 13, 2023

    With CPI notching only slightly higher than expected yesterday and PPI coming in plenty low (0.0% MoM, 0.9% YoY) the FOMC will have a difficult time convincing algos that there isn’t a rate cut coming in the spring.

    Futures continued their meltup… …driven largely by VIX’s repeated meltdown.Ramp it up overnight so you can hammer it just prior to the opening the next morning. Works every time…

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  • CPI Ticks Higher

    CPI came in slightly hotter than expected at 0.1% versus 0.0% expected and prior (annual 3.1% vs 3.1%.) Core was 4.0% (unchanged) but 0.3% monthly versus 0.2% prior and 0.0% expected.) Core goods actually fell 0.3% while much stickier services rose a blistering 0.5%. This is all a bit of a disappointment for the rate cut crowd.

    Futures are off slightly.

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  • Charts I’m Watching: Dec 11, 2023

    Futures are essentially flat ahead of tomorrow’s important CPI print.

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  • VIX: “Don’t Worry About It”

    Despite a much hotter than expected NFP print, VIX’s convenient collapse… …has once again convinced investors algos that there’s nothing to worry about. The 20-pt drop in futures following the print was erased within minutes.

    It’s all in keeping with our year-end forecast, which remains unchanged.

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  • Update on Oil and Gas: Dec 7, 2023

    Algos popped in the past hour on a larger than expected increase in initial jobless claims with the more important NFP due out tomorrow.

    But, the more dramatic move has been in oil, with CL reaching our next downside target and RB well on its way to its own.

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  • Christmas Comes Early

    Futures continue to be supported above their 10-day moving average by a combination of algo factors led by VIX. The Christmas meltup came early this year and, so far, shows no signs of letting up.continued for members… (more…)

  • Update on Gold & Silver: Dec 5, 2023

    As noted yesterday, gold and silver reached our target ranges from mid-October.  GC came up slightly short of its target from Oct 18 [see: Mideast Worries Mount]…

    …before being aggressively hammered.

    Silver nailed its target very precisely before meeting a similar fate. We’re faced with the usual questions after targets are reached: Was that it? Is it over? What’s next?

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  • Charts I’m Watching: Dec 4, 2023

    Futures are off sharply this morning, suggesting a break in the upside momentum.

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  • The Dow’s Warning

    Futures are off moderately on the first trading day after what was a torrid November. Bears might take some comfort from the overbought Dow, which has reached Fibonacci and channel resistance.

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