Update on Currencies: Jul 2, 2021

As we noted yesterday, EURUSD is finally fulfilling our expectation of a breakdown from the trend established at the Mar 2020 lows.  This move has been a long time coming and has potentially significant consequences for the DXY. continued for members… … continue reading →

Are Things Really Better?

Under ordinary circumstances, a 2.3% MoM bump in Durable Goods orders would be very welcome – especially on the heels of last month’s -1.3% print. When inflation is a growing concern due to the Fed’s largesse, however, it complicates things. For instance, might it cause the Fed to take its foot off the gas? Not … continue reading →

Bad News is Good Again

If yesterday’s better than expected ADP jobs data was bad news, then it stands to reason that today’s worse than expected DOL NFP print would be good for the market.  Well, that, and the 13% pounding VIX has taken… As it was hammered back below its SMA10, ES was ramped up above its SMA10. Funny … continue reading →

Not So Fast!

You could argue that the annual PCE print of 3.6%, the hottest since 1992, is merely a function of the base effect – last year’s crash in inflation.But that argument falls flat when you consider that MoM Core PCE, which is completely unaffected by the base effect, soared by a record 0.7%. Naturally, both stocks … continue reading →

What’s the Holdup?

The Dow, the most easily and commonly manipulated index, has gone nowhere since failing to hold its 3.618 Fib extension at 34,430. It begs the question: what’s the holdup? Usually, when a closely followed index goes sideways for a while, it’s because an important moving average is moving into position for a backtest. But, is … continue reading →

Why Bonds Are Still Important

I had an great question yesterday regarding the bond market: “Is it possible the fear of pandemic in spring 2020 affected the behavior of 2yr and 10 yr and then indirectly triggered the crash?” Pebblewriter longhaulers will recall that our bond cycle model forecast a severe plunge in interest rates long before anyone was talking … continue reading →

COVID: Still With Us

Interesting piece in Reuters today on Japan’s vaccination efforts and the overwhelming level of infections in Osaka, Japan’s second largest city, only two months ahead of the Olympics. While many countries are making good progress with vaccinations, Japan – the 11th most populous country in the world – is lagging badly.  It’s not the only … continue reading →

Biggest Jobs Disappointment in Over 20 Years

Blockbuster jobs data? Not so much. At 266K versus over 1MM consensus, it was the worst miss since 1998. The futures initially held the overnight ramp, taking their cues from VIX, which barely budged on the hugely disappointing print. But, VIX also hasn’t (yet) broken down the way it normally would if a full-court press … continue reading →