pebblewriter

Tag: silver

  • Powell’s Jackson Hole Speech

    Powell threw cold water on the market’s optimistic outlook this morning, suggesting that aggressive tightening will continue.

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  • Charts I’m Watching: Aug 24, 2022

    Futures are flat after enjoying a modest overnight ramp.

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  • More Where That Came From

    Yesterday marked the second day in a row of sharp declines in the equity markets following the 200-day moving average backtest and the passing of OPEX.There’s more where that came from.

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  • Charts I’m Watching: Aug 22, 2022

    Futures are off sharply this morning, reflecting the lack of support behind the runup to the last two options expirations.

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  • Maintaining an Even Strain

    Looking at the bounce since Jun 16, I can’t help but think of Chuck Yeager’s ill-fated journey into space.

    Futures are up very slightly this morning, fixated on maintaining prices through tomorrow’s massive option expiration.VIX: an excellent example of maintaining an even strain.continued for members… (more…)

  • Retail Sales (Sort of) Flat

    July retail sales came in at 0.0%, a goose egg, versus expectations that were generally around 0.1-0.2%. These data aren’t adjusted for inflation, however, so the “real” change was another drop.

    Markets seem to care at the moment, with ES off nearly 1%.  But, our charts had already called for a reversal yesterday after reaching upside targets across the board.

    With Fed minutes coming out at 2pm ET and VIX still unable to push past the considerable suppression that has been applied at the 10-day moving average (20.51), bears should continue to exercise caution.From a fundamental standpoint, this retail sales report is horrible. It’s disappointing because it’s flat rather than up, of course. But, it’s much worse because it’s not bad enough to sway the Fed from inflation fighting.  We’ll get a peek at their minutes in a few hours, but suffice it to say this bad news is just plain ol’ bad.

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  • CPI Edges Lower

    Futures ripped higher on the news that July CPI came in 0.2% lower than expected on both the monthly and annual headline figures: 0.0% and 8.5%.  Core rose 0.3% and 5.9% – still well above the Fed’s so-called 2% target.

    Much has been made of the price drop seen in oil and gas since mid-June. But, it’s important to note that we’ve seen this happen several times before. The July YoY increase of 44.1% has been about the average low ever since Apr 2021, with several highs in the 60% range.

    Prices would need to continue to decline in order for the YoY change in August to come in below 40%. And, our charts aren’t that all that convincing that oil/gas prices will continue to decline.  Maybe if we had another COVID lockdown or a nice little recession…

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  • 2019 Redux?

    In late 2019, many were mystified by a market that continued to rise even in the face of worsening fundamentals. VIX – the supposed fear gauge – inexplicably plumbed new lows and, eventually, broke down below a channel (in red below) dating back to late 2017….

    …even as news of a deadly pandemic became more and more concerning.  For chartists, the breakdown in VIX was frustrating but telling. Algos and all the portfolios which key off them were keying off VIX. And, the breakdown was all the algos cared about – to a point.

    Eventually, the breakdown was no more. VIX soared and the market plunged. But, for over 3 months (including, of course, the usual YE run to the barn), the market made new highs based almost solely on the vanquishing of fear.

    It’s hard not to think of 2019 when observing the current market. With the Fed’s own forecasts and the bond market screaming “recession,” stocks are ignoring rising interest rates and inexplicably bouncing. Inexplicable, that is, except for VIX.

    I have no secret insider source on the Fed’s trading desk. But, if you were trying to raise interest rates without trashing the stock market, wouldn’t you be shorting VIX every time the market dipped? It’s safe to say that the latest ongoing assault on VIX is the tail that’s wagging the market’s dog…just like in 2019.

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  • Charts I’m Watching: Aug 3, 2022

    The VIX nonsense continues, ramping futures back above the SMA100 with the help of Jim Bullard, Fed president and occasional CNBC host, who insists there is no recession – just like he insisted inflation wouldn’t be a problem.

    Whether there is or not, the market will never reflect one as long as this kind of nonsense goes on.

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  • Charts I’m Watching: Jul 28, 2022

    Another Fed meeting, another VIX-driven algo meltup.

    But, something’s more than a little sketchy about this one – aside from the fact that the recession which Powell refused to acknowledge yesterday just got closer to being official.

    It might be shallow, but the 0.9% drop in Q2 (first estimate, vs +0.5% consensus) makes for two quarters in a row – the commonly accepted definition of a recession.

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