4 replies to this topic

[Tor]

Well, I stick my neck out and run the risk of looking a fool. Fair enough, its the market, to make fools of people. That said, I remain bullish biased. To be clear I was flat yesterday as something didnt feel right. However, I feel this will trun out to be another false dawn for the bears while my IT pivot holds at 1487 closing basis. I wish the bears and the shoeshine boys good luck in their shorts!!

[relax]

today will be interesting, but i'm still holding on to my view that an IT top has been found

so many double top set ups around the world and no fuel to really get us much higher

just a matter of time before rates hit 5.25 again IMO, not good news for the market

Well, I stick my neck out and run the risk of looking a fool. Fair enough, its the market, to make fools of people.

That said, I remain bullish biased. To be clear I was flat yesterday as something didnt feel right. However, I feel this will trun out to be another false dawn for the bears while my IT pivot holds at 1487 closing basis.

I wish the bears and the shoeshine boys good luck in their shorts!!

[Tor]

Equity market performance during rising Treasury yields So, this week we extended the analysis between rising bond yield and how the stock market performs. We went back over the past decade and isolated bond yield spasms into two periods: those dominated by a rise in real rates; and those driven more by inflation expectations. And what we found was that when the backup in 10-year yields is influenced more by real rates (and hence expectations of higher real growth), the S&P 500 on average had positive momentum, and the outperformers were the cyclicals – consumer discretionary, materials, industrials – followed by financials and energy. The laggards were actually the classic defensive areas – utilities, telecom, staples and health care. Now in those episodes when the backup in bond yields is predominantly an inflation-expectation story, like we had a couple of times last year – it’s quite a different story. The S&P 500 in these periods is typically in a corrective phase and sector performance is radically different – the leaders are energy, staples, health care, and utilities. The laggards are tech, telecom, consumer discretionary, materials, and financials. What falls out of the analysis is that the areas of the market that traditionally perform well regardless of whether it is real rate- or inflation expectation-driven were energy and industrials. These are the areas to hide when bond yields go up for either reason. And the areas that have underperformed when bond yields go up for either reason were tech and telecom. Tech perhaps because of it is long duration and telecom because of its inherent rate sensitivity. But what’s nifty is that the current episode to a very large extent resembles this past performance when bond yields are being driven higher by the real rate.

[OEXCHAOS]

One huge caveat. This morning, my first impulse was to start looking long. It didn't make me nauseous. Nobody else seems all that Beared up, either. The Rydex Amateurs didn't buy a lick of Bear funds nor liquidate enough to buy a small home in So. Cal. Volume says that we touch the lows. Might be fast and over, or it might be something bigger. They turn the sentiment in this market quickly. Mark

[Tor]

One huge caveat.

This morning, my first impulse was to start looking long. It didn't make me nauseous.

Nobody else seems all that Beared up, either. The Rydex Amateurs didn't buy a lick of Bear funds nor liquidate enough to buy a small home in So. Cal.

Volume says that we touch the lows.

Might be fast and over, or it might be something bigger. They turn the sentiment in this market quickly.

Mark

Yes.