High Base Breakout Spells Trouble for Bears 6/28/24

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When the market breaks out of a big bottom that forms at a top, it usually means a long couple of months for bears ahead. I don’t know if that will be true this time, but I just thought I’d mention it..

But here, we are only concerned with the very short run. For that purpose we consider that this base breakout carries a conventional measured move target of around 5530. That implies a new high, and an even bigger breakout and higher targets, but we’ll cross that bridge etc.

Meanwhile, a 5 day cycle high is now a little passed gas, and the 5 day cycle projection is only 5505-5510. We’re there. Cycle projections tend to be a bit more reliable than conventional measured move targets. Doesn’t mean that the next 5 day cycle won’t blast off again. But in the meantime, we look out the test of the high, how much the market does or doesn’t pull back from here, to guess on whether another breakout is likely.

If you want to say “Let’s call the whole thing off, then the buying needs to dry up, and enough sellers need to show up to drive the ES back below 5495. Seems like a tall order.  Weak Trend Status Quo 

One thing that has been working in the bulls favor over the past couple of weeks has been a gusher of cash coming into investor and dealer accounts via $45 billion in T-bill paydowns over the past two weeks. I have been projecting that this was coming for Liquidity Trader subscribers. But It’s Over Now. For Primary Dealers Easy Street is No More

The last of the paydowns was, yes, turd day.  Now the market faces a huge slug of coupon issuance. Somebody’s gotta buy that. I feel sorry for whoever it is. Suckers. I just hope they’re hedged or we all be dead, like Joe Biden and the rest of us who treasure a functioning democracy.

Here’s the recent and current docket. I am sorry, party people, but this is not a bullish buffet for In Depends Dance Day.

I keep you updated on what to expect supply wise in Liquidity Trader. Treasury supply is the 700 pound gorilla of the markets so you need to keep an eye on the bastards. Likewise different kinds of supply have different kinds of effects. I splain it all in my regular updates, the most recent of which is here.

For moron the markets, see:   

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