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10yr Treasury soaring, up 9 basis points, Market vulnerable!


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#1 dTraderB

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Posted 15 May 2018 - 01:20 PM

Usually I post once per day but I post again ttoday because the market is in  very vulnerable tone, with the possibility of a sharp drop. 

Am not saying there will be a crash etc but the soaring 10yr yield can be the catalyst that drives the buyers out and reinvigorate sellers. 

SPX 2702/2704 is a key support that has been tested today several times and if broken can lead to a swift down move. 

 

On the other hand, the markets could stabilize with yields backing off and crude moving below $70 (WTI). 

 

SPX 2720 is a key level - above that the bulls in control, below that the bears have the upper hand.

 

VIX has been edging up, now above 14. It is not the actual value that is the key criteria but the relative value of VIX and the 5-day RSI



#2 redfoliage2

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Posted 15 May 2018 - 01:53 PM

One boot dropped for a mini crash, but still waiting for the other one...............


Edited by redfoliage2, 15 May 2018 - 01:55 PM.


#3 dTraderB

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Posted 15 May 2018 - 07:53 PM

Rising interest rates and oil prices are daggers at the heart of the bull and unless these two decline, the markets will face tremendous obstacles in rallying anywhere near the January highs. Of course, the bulls can ignore all these negatives and barrel ahead, but it's will be tough sledding.

 

"Still, the bears were out in force even before the retail-sales data were released. In a note this morning, Gluskin Sheff's David Rosenberg warned that the bullish feeling was being to fade, citing rising bond yields and higher oil prices. "I've been in the business for over 30 years and not once have I ever found a time when rising oil prices and rising interest rates provided a tonic for a bull market in risk assets," he wrote, citing the early 1970s, the late 1970s, the late 1980s, the early 2000s, and 2007-2008 as examples.

So I fall back on my default position: We're in a sideways market and will be for a while. My colleague Alex Eule noted in yesterday's Review & Preview—if you haven't signed up for the newsletter, you should—an argument made by the Leuthold Group's Jim Paulsen. Paulsen argues that bulls and bears are making their cases using the same stronger economic data, one arguing that it will cause earnings to grow, the other arguing that it will force the Fed to tighten. That's left the market running in place."

 

https://www.barrons....kout-1526420805



#4 dTraderB

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Posted 15 May 2018 - 07:58 PM

US 10-year Treasury yield jumps to highest level since 2011 to above 3.09%
  • The yield on the benchmark 10-year Treasury note hit its highest level since 2011 and the two-year yield hit its highest mark since 2008.
  • The 10-year Treasury note yield, a barometer for mortgage rates, rose 7 basis points to 3.069 percent early Tuesday morning.
  • "As long as economic growth remains steady, then the call for the Fed to keep raising rates will stay loud," wrote Kevin Giddis, head of fixed income capital markets at Raymond James.

https://www.cnbc.com...ew-auction.html

 


#5 Chilidawgz

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Posted 15 May 2018 - 07:59 PM

The bull market ended in January.


Anything can happen...what's happening now?
No one can forecast the future. No one.
 
All stocks (ETF's) are BAD...unless they go up - William O'Neil
 

#6 Waver

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Posted 15 May 2018 - 08:55 PM

Chilidawgz
Bull market in stocks are over in your opinion?

#7 Chilidawgz

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Posted 16 May 2018 - 12:15 AM

Chilidawgz
Bull market in stocks are over in your opinion?

 

Let me put it in this context. If I had long positions in tax deferred savings accounts, I would be scaling back on market strength.

 

We need to watch the rise in interest rates. With so much debt in the system (corporate, government, pensions) a significant rise in rates will blow everything up. TLT is off 6.8% ytd and rates have only begun to climb. The next recession will be worse than the "Great Recession". No where to hide IMO...unless gold takes off.


Anything can happen...what's happening now?
No one can forecast the future. No one.
 
All stocks (ETF's) are BAD...unless they go up - William O'Neil
 

#8 Waver

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Posted 16 May 2018 - 03:54 AM

Chilidawgz
Fundamentally you make all the sense in the world
How are your technicals looking? Still bullish on the short and intermediate term?

Thanks again for the info!

#9 Chilidawgz

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Posted 16 May 2018 - 04:32 AM

ten.gif


Anything can happen...what's happening now?
No one can forecast the future. No one.
 
All stocks (ETF's) are BAD...unless they go up - William O'Neil
 

#10 Chilidawgz

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Posted 16 May 2018 - 04:47 AM

Chilidawgz
Fundamentally you make all the sense in the world
How are your technicals looking? Still bullish on the short and intermediate term?

Thanks again for the info!

 

Stock models: Long Term is bullish. Intermediate is bullish. Short term (daily) is on a sell. (I trade off daily charts looking back to the intermediate trend direction) I am all cash in stocks and bonds. I would not touch bonds, that market is toast as rates are rising. The cycle is reversing.

 

If my intermediate stays bullish on this pullback, I may go long again.

 

ten2.gif


Edited by Chilidawgz, 16 May 2018 - 04:49 AM.

Anything can happen...what's happening now?
No one can forecast the future. No one.
 
All stocks (ETF's) are BAD...unless they go up - William O'Neil