Momentum: It Goes Both Ways

The correction is gathering steam, with ES off 40 points earlier this morning before getting a bounce. From a technical standpoint the culprit is VIX, which broke out of the falling channel which has guided stocks higher since March 2020. Our downside targets remain unchanged. continued for members… … continue reading →

Retail Sales Falter Without Stimulus

July retail sales fell 1.1% versus -0.3% consensus, reflecting the impact of stimulus payments, Amazon’s Prime Day change, and the general apprehension surrounding the delta variant. Yesterday’s bad news faded under heavy algo action, with VIX going into meltdown mode……the instant SPX reached its SMA10. The bears will get another shot today. continued for members… … continue reading →

Inflation: Still Here

Annual CPI remained at 5.4%, the highest in 30 years. And, that alarming number masks plenty of data which the BLS methodology simply ignores. Shelter, for instance, registered a 2.8% YoY increase per BLS’ survey-based calculation. Yet observed apartment rents increased at 9.2% in just the first six months of 2021. And, housing prices have … continue reading →

Charts I’m Watching: Jul 6, 2021

Stocks rarely drop over a 3-day weekend. This one was no exception. The miniscule decline we saw in the futures last night has been all but erased despite a conciliatory 5% bump in VIX to backtest its SMA10. No fuss, no muss. 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 →

Charts I’m Watching: Jun 21, 2021

ES came within 9 points of our next downside target before getting a nice bounce motivated primarily by USDJPY, which was working flat out to save the NKD from a scary, and long overdue dive to its SMA200. This bounce will be quite important to the bulls, who are no doubt hoping to avoid a … continue reading →

Bullard: Wait, Did I Say That?

Not that futures needed any help melting down this morning, but Jim Bullard just poured gas on the fire. Yes, Jim Bullard! The Fed president who never had a hawkish thought in his life. "We were expecting an inflationary impulse, but this has been more than what we were initially expecting," says James Bullard. "The … continue reading →

Currencies: Tick-Tock

Neither yesterday’s FOMC announcement nor Powell’s press conference produced any meaningful surprises. Yes, the dots shifted slightly, but everyone knows they’ll shift a lot more before long. Futures easily reached our initial downside target and came within 5 points (so far) of our second. But, the real action was in currencies, which were finally turned … continue reading →

The Fed’s Big Day

We’ve pretty much beat the inflation horse to death on these pages over the past six months. Bottom line, It’s too high and potentially out of control. So far, however, the Fed’s been able to hoodwink investors and algos and commandeer the bond market. Aside from making things much more difficult for the little guy … continue reading →