Rates don’t matter. What bull market in history hasn’t been accompanied by rising interest rates? Rates are the price of money. They are the the result of the interplay of the supply of money versus the demand for it. Of course it’s complicated by the fact that money demand also increases supply, but we won’t go there.
Another thing. Watch what they do, not what they say. Fact is, monetary tightening continues apace. That’s important. As long as the big 3 central banks are tightening, on balance, push will eventually come to shove. They will ultimately get the result they want.
We’re not there yet. Inflation measures are converging around 5% and you gotta wonder if that little bank intervention thing that the Fed did in March might not lead to a little CPI uptick in the next few months. Wouldn’t that be special.
Another fact, as long as there’s sufficient liquidity, something will go up in price. Under conditions of monetary tightening, such as the present, the key here is “some,” not all. We use TA to identify what the “some” is.
As for whether there were inflows from foreign markets in the 70s, of course there were. Bear in mind however, that in the summer of 1974, average daily volume on the NYSE was around 7-8 million shares. The average for the year was 14 million shares per day.
Total.
For everything.
All day.
I remember days where the tape didn’t move for seemingly minutes at a time.
So, yeah, this is different.
As for the day trading setup, the ES 24 hour S&P futures finally had a down phase on the fifth day of the 5 day cycle. That means that this morning should ideally be the cycle low. First step would be for this little low to hold on a test. Then an up phase would require a move through 4375 or so to get anything going. If they do that, next target would be 4391 test. Then who knows?
To have any bearish expectations first they’d have to take out yesterday’s post announcement plunge low of 4337. Fat chance.
For moron the markets, see:
- Rally Broadens as It Gains Momo June 12, 2023
- Swing Trade Chart Picks – Let Your Profits Run June 9, 2023
- Gold Set Up for This Cycle Low June 7, 2023
- Investors Breathe Sigh of Relief But D-Day Is Now June 6, 2023
- Incomprehensible, That’s What You Are June 2, 2023
- Modestly Hedged Dealers, Record Short Hedge Funds Suggest Disaster Ahead May 25, 2023
- The Most Widely Forecast Economic Disaster In History May 16, 2023
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