CPI’s Head Fake

This CPI data is significant in that it shot up over 2% – the highest since 2018 when the prints of 2.95% (July) and 2.70% (Aug) sent the 10Y up to 3.25%. But, it’s the inflation happening right now, which will be reported next month, that the Fed is worried about. As we’ve anticipated, March’s … continue reading →

Calm Before the Storm?

There are many parallels between yesterday and Jan 26, 2018 – the calm before a vicious 10-day 11.8% storm.  The obvious one is that SPX is back to the top of the large yellow channel dating back to the 2009 lows.  Then, as now, this occurred shortly after SPX had bulled its way through a … continue reading →

Known Unknowns Strike Again

I’ve glanced wistfully over the years at announcements of runs I’ve enjoyed in the past: countless 5Ks, 10Ks and a handful of marathons. Together with high school football, college rugby and too many pickup basketball games to count, they had bestowed me with the knees of a senior citizen well before any gray hair clocked … continue reading →

Algos to Stocks: “We Got This”

It’s a light volume day leading up to a holiday weekend – the market’s favorite time to take a shot at important resistance. Though SPX tagged its 3.618 Fibonacci extension several weeks ago, ES has fallen short time after time. The disappointing employment data due out at 8:30 wasn’t going to help, so VIX jumped … continue reading →

USDJPY’s Turn

Members will recall that one critical component of our oil/gas decline scenario is USDJPY’s breakout from the falling channel from 2017 shown below.  Guess what? The yen carry trade is a tried and true method of goading the algos into buying equities – even overpriced ones. It works especially well as a counterweight to falling … continue reading →

Update on Gold and Silver: Mar 25, 2021

We have multiple targets being reached this morning, and several more in the works. We’ll start with ES, which just tagged our SMA50 target in a backtest of the falling white channel from which it broke out two weeks ago. The one we’ve been waiting on for what feels like forever, though, is silver. SI … continue reading →

Don’t Fight the BoJ

I know what you’re thinking: it’s “don’t fight the Fed.” While that’s generally true, too, the Bank of Japan is the central bank which most conspicuously wears its balance sheet on its sleeve. When my charts are a farrago of bearish indicators, but the Nikkei pushes up through resistance? I’ve learned to ignore the indicators … continue reading →

The Bond Market Finally Woke Up

For months we’ve been warning about the coming inflation problem, wondering when the bond market would notice and/or care.  The immediate problem in a nutshell: One of the most highly correlated components of CPI with the headline rate is the price of energy, and gasoline in particular.  If prices were to remain where they are … continue reading →