Primary dealers have maintained huge and heavily leveraged long bond positions. They are only lightly hedged. Just today, the bond market is threatening to reverse the long term downtrend in yields/uptrend in prices. It’s bad news for the bond market, and for the system as a whole. And that includes stocks.
Here’s where to look for gold’s constructive consolidation to turn up. Meanwhile, I’ve added another pick to our list of miners.
Mixed cyclicality has led to a rangebound market. There’s no sign that that will change this week. But look out if it does!
The outlook for the most of the rest of October is bullish. But it’s not an endless bull any more.
The setup is propitious for a short term low risk entry. The setup is propitious for a short term low risk entry. There are a…
An up day on Monday would confirm that the short term downtrend is broken. This report gives you the key support and resistance levels, and…
We have known for a couple of months that there would be a mountain of Treasury supply hitting the market at the end of September. We also knew that Fed QE would be far from adequate to absorb this supply. So I have expected something bearish for stocks at the end of September. This could spill over into the first week of October.
But then things get hairy for bears, with potentially happy days for bulls. Unfortunately, we have a little problem this week. There’s no visibility. We don’t know what they have planned for the next couple weeks. That’s different from usual, where we can usually see ahead for a week or two because we know the Fed’s QE schedule, and also pretty much know how much Treasury supply to expect.
Now, thanks to the exigencies of the past pandemiconomic US Treasury fund raising back in March and April, we don’t have that luxury on Treasury supply, which forces us to surmise some things.
Here they are.
There’s good reason to think that a 13 week cycle low is forming despite lower projections.
Composite liquidity continues to rise, but at a slower pace than in the second quarter as the Fed has slowed QE. That reduces the cash flowing into Primary Dealer accounts, which in turn contributes to a slowing in secondary liquidity drivers.
“Slowing” is a relative word, however. Historically, the numbers remain gargantuan.
No, something else is holding the market back. Here’s what that something is, and what we’re going to do about it.
An important low is due right now but bears have a chance to break the market. This report shows you the setup and gives you…