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Macroeconomics

Credit - US10Y to DeclineIdea for US10Y: - US10Y will decline - institutional fear > buy safe bonds. - Positive correlation in yields/equities right now (extreme periods) - Markets are topped, this will cause a decline in equities. - UST signaling deflationary shock. Yes, you will have inflation win out in the end, but you can have deflationary shock to get Fed to enact more extreme monetary policies. You can have negative growth during price inflation. Reminder that major crashes are preceded by capitulation in yields: GLHF - DPT
TVC:US10YShort
by UnknownUnicorn1043646
4
Macro - "A Permanently High Plateau"Idea for Oil/Macro: - The bottom line is that the inflation narrative is driven by one commodity - Oil. - Price is at a 40 year resistance. - The only thing actually holding up the price of oil is OPEC+ agreeing to cut production (Artificial inflation). - QE is actually deflationary, all it does is put a floor on markets and suppresses volatility and creates speculative bubbles, the money doesn't directly leave the banking system. All bubbles pop. - Right now there is price inflation due to supply chain disruptions and commodity prices - but speculative bubbles in commodity prices are already collapsing. They will all follow. - Global productivity is on a decline, see GDP Growth Rate, World Manufacturing Output. - The artificial growth you see now is debt driven. See Debt as % of GDP. Appearances over results. - Unemployment numbers can be suppressed with cheap and unskilled jobs, but take a look at declining quality of jobs. - Equity prices follow forward inflation expectations. They are falling: fred.stlouisfed.org Why would anyone buy a risk asset when inflation is expected to decline? They would just be in appreciating cash. - The reversal is caused by the global credit impulse. Credit is an actual inflationary force. - What is happening now in Equities is that banks and companies are simply using margin debt for leveraged stock buybacks, boosting EPS. - Zombie companies are not allowed to fail, and money losers are flooding the market with shares - raising more money than moneymakers. This is Euphoria. - However, easy credit is over. Now credit contractions are spilling over to US - see Wells Fargo cutting personal lines of credit. - Debt will be called, particularly from overseas - see Evergrande. - PBOC has been draining liquidity in China via RRP, US preparing to do the same via RRP. It is the first step of Tapering and the effects will be felt in the coming weeks. If you think about it, it does not make sense for the economy to be booming during a global pandemic crisis, despite what the media is blaring. It is debt fueled, and can it handle the next crisis? The pandemic is not even over yet, by a long shot. If you have an understanding of the internals of markets, correlations and the liquidity flows, you can see macro trends as they develop and predict them. When oil reverses, the reflation trade will be over. Same with gold - this can be a distribution pattern (the inflation fears were priced in and distributed already): Bitcoin - Speculative risk asset already collapsed: Lumber - Great canary and speculative risk asset collapsed: It's all the same story for bond yields and currencies: DXY - Dollar seems to have found a base: Bond Yields: AUDJPY: EURUSD: CHFAUD - Indicating some fear: Significant warnings: - SP500 vs Margin Debt - SP500 vs Real Earnings Yield - SP500 vs Real Dividend Yield - US Quarterly Equity Offerings - Collapsing Market Breadth - Transports turning down - Rydex Bull/Bear ratio - Market internals not confirming low volume ATHs (bearish divergences) PC Ratio reaching lows not seen for 10 years: SKEW reaching ATH while VIX is crushed - Smart money + insiders positioning in accumulation phase: We might get a few more high inflation prints due to lagging effects, but commodities will crater once retail is completely positioned for inflation. Speculate that market conditions have changed such that crashes like the COVID crash will be regular occurrence, due to the options market being the real market. Speculate the reversal Jul. 12-Jul. 14, downtrend through Aug into a capitulation on Sept Quad Witching. "Stock prices have reached what looks like a permanently high plateau" - Irving Fisher, 1929, days before the market began crashing to total -89.2%. GLHF - DPT
NYMEX:CL1!Short
by UnknownUnicorn1043646
1
BULLISH reversal in play for the US Dollar! Following the 2008 Financial Crisis, the Federal Reserve had to apply loose monetary policy measures in order to stabilize and stimulate the economy. The Fed started lowering the Federal Funds Rate back in late 2007, as a response to the rising unemployment at the time. This is the most traditional monetary policy measure, which aims to stimulate both businesses and individuals to borrow and spend more, which in turn would lead to an increase in economic activity. When rates are low borrowing money to start a business, buy a house or a car looks much more appealing and attractive. When the economy is in a recession such monetary policy actions are helpful and needed, but if interest rates stay very low for way too long after the economy stabilizes, then the higher spending levels caused by the cheap available credit would simply lead to higher inflation. Inflation has been one of the most heavily discussed subjects so far in 2021 and rightfully so. You see, a substantial increase in inflation is a net negative for all of the major markets out there – Bonds, Stocks, USD Bonds Inflation is a bond’s worst enemy as basically a bond is a contractual agreement between a borrower (Seller of the bond) and a lender guaranteeing that the Lender (Buyer of the bond) would be receiving the bond’s Face Value at maturity plus all of the regular and fixed interest payments (coupons) up until that point. Well, considering that both the Face Value and Coupon are fixed US Dollar amounts, a higher inflation would basically erode the real returns of that bond. To put it in simple words if the yield on a 10-year Treasury bill is 2%, that means that the investor is guaranteed to get a 2% annual return on that bond investment. However, if annual inflation is at 5%, then that makes the bond investment much less appealing as an investor would be technically losing 3% per year in such environment. This is the main reason why bond yields constantly adjust to both Inflation and Interest Rate expectations. When Inflation goes up, Interest Rate expectations start shifting towards expecting a rate hike, which leads to lower bond prices and higher bond yields. This dynamic exists and occurs as in an inflationary environment bonds become less attractive and in order for demand to come back to the bond market investors need to see an adjustment in the bond yields (an increase), which will protect them against inflation and would make it worthwhile for investors to lend their money to the US government by buying these bonds instead of putting it in a savings account with the bank. The bond yields rise either when we see a rate hike or when investors expectations of a rate hike increase. This mechanic ends up protecting bond investors in a higher-interest and inflation driven environment and makes bonds more stable and attractive investment vehicles than stocks. Stocks With stocks it is much more straightforward. Stocks trade largely on current as well as discounted future corporate profits, and higher rates tend to cut into profits because they increase the cost of money. Additionally, when rates are higher that means that discounting future cash flows to the present occurs with a higher denominator, which leads to lower profitability. If the underlying reason for higher rates is inflation, rising prices and wages also increase a company's costs, which further erodes profits. As you can see higher inflation and higher rates lead to plenty of problems for stocks. USD Last but not least, inflation is also bad for the US Dollar as it erodes the purchasing power of every dollar in circulation. To put it in simple words, if you have $100,000 in your savings account earning 1% interest annually, but the inflation in the country sits at 3% you would technically lose 2% from the purchasing power of your capital, or in other words $2,000, in just 1 year. Now, after seeing why and how higher rates and higher inflation affect Bonds, Stocks and the US Dollar, you probably understand why all journalists, economists, investors, hedge fund managers, politicians, central bankers etc. are constantly discussing these topics. Inflation and Interest rates expectations are not static but rather very dynamic and are constantly modified and affected by economic reports, central bank commentary, monetary and fiscal stimulus etc. The predominant view in the market at the moment is comprised of the following elements: 1.”The US economy is on fire” – companies continue to deliver better than expected earnings, consumers are sitting on record levels of savings, people are eager to get back to their normal lives eating out, traveling, shopping. 2. “We will see 8-10% GDP growth in the 2nd half of the year” 3. “Inflation will continue to rise as a result of the low interest rate environment and the huge spending driven mostly by the heavy Fiscal Stimulus by the US Government. 4. “The Fed need to raise rates sooner in order to prevent a hyperinflation scenario” 5. “The Fed will most likely end up being behind the curve once they start tapering, which will force them to rise interest rates quicker” Now, while all of the above-listed arguments make sense to a certain extent, we believe that some of the most recent movements in the US Dollar Index (DXY) as well as the price action in the bond market, which sent bond yields lower despite the hawkish Fed in mid-June are giving us very valuable indications that there is more to that equation. We believe that the whole narrative that is circulating at the moment starts from the wrong place. Considering the fact that the US Dollar is the global reserve currency and that it has a direct impact on both US and Global inflation levels and GDP growth, every US economic analysis should start from analyzing the US Dollar performance and its possible future trends. It is true that inflation expectations affect the value of the dollar and that some people might argue that this is a “what’s first the chicken or the egg” argument, but the US Dollar is so much more than the inflation expectations that people throw at it left and right. The USD is the most influential currency in the world and depending on whether it gets stronger or weaker we see whole countries, regions and even continents either struggling or prospering. The US Dollar index (DXY) has been in a clear downtrend throughout the last 15 months, as a result of the unprecedented printing of money that we have witnessed by the Fed in response to the COVID-19 pandemic shock to the economy. The monetary M2 supply in the US increased from $15.5 trillion in February, 2020 to $18.84 trillion in October, 2020 and to $20.1 trillion in April, 2021. This represents a 21.29% increase in 2020 and a 29.7% increase year over year. Technically, such a massive printing of liquidity debases and devalues the underlying currency. As a result of that and the increased inflation speculations and worries among investors we have seen the US Dollar index dropping from $103 down to the $90 level. A lot of negativity has already been priced in the US Dollar as the logic shows that inflation will definitely be picking up, which makes it unattractive to hold significant cash reserves. Thus, everybody has been selling the USD for over a year now. However, what happened in the beginning of the year (January) was that the DXY reached the $90 strong multi-year support and found a lot of buying interest there. After a strong rebound up towards the $94 level back in April, the index came back and re-tested the $90 level and once again found a lot of buying interest, which pushed the price back up to the $92 mark in a matter of few trading sessions. This has created a clear double-bottom pattern with rising relative strength and a clear bullish interest at these levels. We believe that this is something that not many people are paying attention to as they are riding on the bandwagon that the “Dollar is going lower”. However the $90 support has been a crucial level for the DXY going all the way back to 1990s. Back in 2018 that was the exact level where the DXY stopped declining and reversed the 1.5 year long bear market that the USD was trading within since the start of 2017. The reason why we believe that the way the USD moves is so crucial at the moment comes from the fact that the main argument right now for a tighter monetary policy is associated with the “double-digit” GDP growth that everybody expects in the 2nd half of the year and the inflation that this is expected to create in the economy. Well, it seems that most people have forgotten that currency appreciation usually reduces inflation because imports become cheaper and the lower prices lead to lower inflation. It also makes imports more attractive, causing the demand for local products to fall. Local companies usually have to cut costs and increase productivity so they can remain competitive. Furthermore, that means that with the higher price, the number of U.S. goods being exported will likely drop. This eventually leads to a reduction in gross domestic product (GDP), which is definitely not a benefit. That translates to a benefit of lower prices, leading to lower overall inflation. The bond market also signaled that it does not expect the Fed to start tightening any time soon as there was a clear discrepancy between the hawkish Fed and the movement in the 10Y Treasury yields. You see, usually when an Interest Rate hike takes place or when Interest Rate expectations shift towards an increase in the Federal Funds rate, that is considered as bullish for bond yields. The reason for that as we pointed out earlier is associated with the fact that a rising interest rate environment and a potential for higher inflation makes bonds less attractive at the current extremely low yields. Bond yields then go up in order to bring back investors to the Bond market. Well, that has not happened this time around as even though we had a surprisingly hawkish Fed in mid-June, the 10Y Treasury yield has continued to fall. It seems that the 40-year long bull market for bonds has further to go. The Bond market always gives indications as to what is actually happening in the economy but very few people know how to read the correlations and information properly. The most recent price action in the 10Y Treasury yield shows that the real probability of the Fed tightening sooner than expected is much lower than what the equity markets and all other market participants are currently pricing in. Bond investors tend to have more macro-oriented view, which allows them to see the big picture better. So what does that mean? Well, with the US Dollar threatening to reverse its 1-2 year downtrend and break above the critical resistance sitting at 92-93 and Bond yields falling, the economy and inflation growth will be tamed organically by the higher dollar. We believe that this would lead to the Federal Reserve also pushing back its tightening program, which in turn will reignite risk-appetite in the market. Thus, we expect to see Growth outperforming Value in the coming months.
TVC:DXYLong
by DowExperts
EURUSD drops back below 200-day EMA to keep sellers hopeful Sluggish markets and wobbling Treasury yields keep EURUSD below the key EMA amid a quiet session on early Thursday. However, the scheduled release of the US Durable Goods Orders for May probes the pair sellers as Fed policymakers and chatters over President Biden’s stimulus have already poked safe-haven demands of the US dollar. Technically, the currency pair battles the 200-day EMA level of 1.1940 as RSI recovers from the oversold area, flashing brighter odds for the upside move towards the 1.2000 threshold. Though, the quote’s further advances will be capped by lows marked during late January and early June around 1.2050. On the contrary, the current bearish impulse aims for an ascending support line from March-end, near 1.1855. Following that, a bit broader rising trend line, near 1.1760, will be crucial to watch as it holds the key to further south-run to yearly low and November 2020 bottom, respectively near 1.1710 and 1.1600. It’s worth noting that EURUSD is in a consolidation mode and hence downside becomes more acceptable than the otherwise case.
Short
by MTradingGlobal
The Credit Cycle - Free Wealth is Over?Idea for Macro: - Financial sector selling off heavily. - While it's early to call a bear market, the exhaustion gap at an all time high is a reasonable signal for market reversal. - XLF, XLE and FAAMG have been holding up the broader markets at this high... Cracks appearing? Underlying conditions: - Institutions will invest based on 18 months into the future (Druckenmiller). - There are 3 relevant possibilities for the banks: (1) Inflation is sticky, interest rates will be raised in the future, within 18 months. This actually increases the banking sector's profitability, but the price is declining because they have been speculated above valuations. (2) Inflation is transitory, interest rates will not be raised, and we will have negative real rates. This will hurt the banks' profit margins. This is a possibility due to the 40 year demand-push deflation the US has been in (see Oil/CPI). (3) More importantly, the economy will decelerate (deflationary). Liquidity components of the Fed B/S have been decelerating and global credit impulse (lending) has gone negative. No more easy lending, less loans, meaning less earnings for the banks. Investors know this and are exiting the overheated trade. Either way for inflation, global liquidity and global credit impulse are turning down, so the Long Volatility trade seems to be ideal. Why did global risk assets rise to such insane levels? Credit impulse - easy lending. Now that supply of sugar is gone. Only one thing left that can happen. GLHF - DPT
AMEX:XLFShort
by UnknownUnicorn1043646
Look at all these sector rotations! Welcome to the new regimeRecently we've seen a significant "rotation" in markets toward large cap tech and defensives, and away from small caps, financials, and transportation. In this post, I will describe the rotation through a series of charts, and I will also suggest some explanations for what's going on. The long and short of it is that I think we've just witnessed a regime change, and markets are going to look very different for the rest of the year. What's up: ecommerce, software, automation After a long period of underperformance early this year, the software sector made a bullish trendline break vs. the S&P 500 at the end of May, and has been outperforming ever since: Likewise the Global X Robotics & Artificial Intelligence ETF: And the Amplify Online Retail ETF: Note that the online retail ETF is outperforming despite recent weak retail sales numbers. What's down: airlines, retail, materials While tech names have been breaking out upwards, we've seen downward breakouts in several other sectors that outperformed early this year. This includes most of the winners of the "reopening" trade, including airlines: The "consumer discretionary" or retail sector has also rolled over, obviously with the exception of ecommerce: As retail rolls over, we're also seeing some very bearish action in the materials sector. In addition to a sharp selloff in lumber, we also saw iron ore and gold take big dumps in the last few days. The materials sector has broken its uptrend relative to the S&P: What's going on: weak demand and the Delta variant Partly tech may be outperforming because of falling bond yields. Tech has been inversely correlated with interest rates since early this year. But I think a couple other factors are also in play. The economic data lately have been very disappointing, with weak retail sales, weak durable goods orders, and weak housing starts. A lot of consumers now say they are hesitant to buy a house, and initial unemployment claims ticked up significantly this week. The ECRI leading weekly index has been in a downward slide since mid-March. All of this points to weakening consumer demand, which I think is why you see the retail and materials sectors falling so hard. The drop-off in demand is partly due to inflated prices, and partly due to the elimination of expanded unemployment benefits. Having already spent their stimulus checks, consumers now simply have less money to spend. There's another factor, too, which is Covid-19 variants. The variant known as "Delta" has been ravaging India and spreading fast in the rest of the world. This variant is highly contagious and has been described as "Covid-19 on steroids." Meanwhile, the vaccine-resistant variants known as "Alpha" and "Beta" have been spreading in Europe and the United States. Alpha is now the predominant strain in the US, having increased from 12% of cases to 37% of cases in the last 4 weeks. With variants a growing threat, it's possible that some traders are hedging against a "reclosing" economy, or at least the possibility that consumers might travel less. Another noteworthy shift: bonds over financials Also note that financials have broken their relative uptrend, with a big drop today: The selloff in financials was a reaction to the upward breakout in bonds: It appears that we're headed into a new cycle of monetary stimulus and low interest rates, which means lower yields for banks. Oddly, the US dollar also broke out upward today. I'm unsure what that's about, or how it fits in with the price action in bonds. Normally higher bonds and higher inflation would be bearish for the dollar. What's threatened: aerospace, energy, and transportation The aerospace, energy, and transportation sectors are so far still in an uptrend, although all three exhibited some weakness today. You'd think that aerospace would fall along with airlines, but remember that the aerospace sector also includes defense, and we are increasingly under threat from China. The transportation sector includes passenger travel like airlines, but it also includes shipping companies like UPS and FedEx. So ecommerce strength may offer some support, but this could still fall out of its uptrend soon. The energy sector trades somewhat in sympathy with transportation, so transportation weakness could bode ill for energy. Energy is also inversely correlated with the US dollar, so today's upward dollar breakout could cause pain for energy. However, this sector is currently being supported by oil shortages and hype around the possibility that oil will reach $100/barrel. Keep an eye on defensives, real estate, and biotech Investors seem to be getting more and more defensive. That includes taking refuge in large, high-quality names. Large caps underperformed early this year, but that has changed in June, with the cap-weighted S&P 500 having broken its downtrend relative to the equal-weighted index: It also looks like several defensive sectors are basing relative to the index. The relatively undervalued communications sector may benefit from the bipartisan infrastructure bill that's now near to passing in the Senate: We're also seeing consumer staples, utilities, and healthcare find some support, though no big upward breakouts yet: Surprisingly, real estate and biotech are also both seeing bullish movement relative to the S&P 500, so these are sectors to watch. Both are relatively undervalued due to having underperformed for a long time:
AMEX:JETSShort
by ChristopherCarrollSmith
8
Macro - Risk is Very HighIdea for Macro: - Credit Cycle turned down from top of Risk Range. - Global Credit Impulse negative, US Systemic Liquidity Flows turning down, Fed Balance Sheet 5yr avg. at top of risk range. - Demand-push Inflation at top of risk range, in 40 year downtrend. - Implied Volatility vs. Realized Volatility reaching a critical level. - PC ratio reaching low levels (signals investor complacency). - SKEW at an ATH. Perceived Tail Risk is at an ATH. Speculate a correction in equities this Summer, then a large correction EOY-Q1 2022. GLHF - DPT
TVC:US30YShort
by UnknownUnicorn1043646
5
China Credit Cycle & US MarketsIdea on Macro: - China's Credit Impulse has turned negative. - Credit impulse is the change in new credit issued as a % of GDP. - China's Government Bonds 10 YR Yield are correlated with China's Credit Cycle. - The Credit Cycle taking a downturn signals deflation. Bond prices will rise as borrowers (issuers) will expect to pay back the principal at a loss, and interest rates will fall to incentivize borrowing. During deflation, default risk increases. - There is news of China "cracking down" on the market... Warning signs: www.bloomberg.com Commodities: www.reuters.com Cryptocurrencies: www.reuters.com - However, these are simply headlines. What is occurring is a downturn in the China Credit Cycle, and deflation in their economy. - The US markets too follow the China Credit Cycle. After the 2008 bailouts, the US markets followed the credit impulse back to recovery. - Now China's Credit Cycle has begun a downturn. US markets have deviated so far from this traditional relationship - creating a global asset inflationary bubble, that there is only one thing left it can do, according to reflexivity... return to the mean. - Once the deflationary shock takes place, there are several ways out. WWII followed the Great Depression, with defense spending and inflation. - A wild thought, but perhaps with the UAP disclosures, the US is toying with an idea for future defense spending... www.cnn.com GLHF - DPT
TVC:CN10YShort
by UnknownUnicorn1043646
DXY - USD BounceIdea for USD (DXY): - DXY has been on a decline. - However, Trade Weighted DXY has yet to decline, such that it is difficult to tell what exactly it will do next. - This means that the dollar has been losing strength mostly against the Eurozone. - It is possible that the dollar will continue its decline: - However, in a shorter time frame, it is looking likely for a small bounce. - Looking at the EURUSD chart, a likely trade setup is forming: Key EURUSD resistance: Speculation for the long term: GLHF - DPT
TVC:DXYLong
by UnknownUnicorn1043646
Black Swan - The End of a Force-Fed Credit CycleIdea for US10Y, Credit Cycle, and Equities: The Bottom Line: - There is no monetary inflation, because the money created does not enter the economy... however there is credit inflation because credit is created with that money as collateral. - There is PRICE inflation, ASSET inflation, CREDIT inflation, NO monetary inflation, oil deflation. - When credit can no longer inflate, credit inflators will begin to sell assets so that they can redeem their asset appreciation for money to redeem for the debt they have lent or borrowed. Where is the money that was injected into the economy? Where did it come from? Who loses here? YOU! The money created from high salaries caused by the speculative asset bubble, and the middle class who invest their hard-earned dollars into the asset bubble, creating more jobs and easy money, which is in turn invested back into the bubble for effortless paper wealth... The inflated prices you pay for food, education, housing, health care... When credit inflators decide to redeem their asset appreciation. It all returns to ashes. - During the collapse of a credit bubble, governments will sell off bonds in a frenzy, because there is too much supply. GLHF - DPT Allies — the strongest and truest in the world: underlying conditions - Jesse Livermore
TVC:US10YLong
by UnknownUnicorn1043646
9
Black Swan - Stagflation and Deflationary ShockIdea for Macro: - Oil is in a downtrend, at the resistance. - Current price inflation and USD devaluation is an attempt to inflate it over the resistance. It will fail. - When Oil reverses, USD will reverse. - Talking heads talking about beginning tapering talks, talking about inflation, talking about deflationary shocks EOY or next year... No, it is already here. Deflationary shock comes first. Taking the contrarian position: - Short Credit - Short Equities - Short Gold - Short Oil - Short Housing - Short Crypto - Long Volatility GLHF - DPT
NYMEX:CL1!
by UnknownUnicorn1043646
3
Towers Reaching For The HeavensIdea for Macro: - Inflation? Deflation? Both exist. - The bottom line is that there is deflation in demand. The price of Oil/CPI is on a clear decline. - The Fed and Central Banks do not control economic inflation and deflation, only asset inflation. - Inflation exists in assets, as made clear by the parabolic prices of nearly every asset class. - The USA is the world's largest debtor nation, and their debt is increasing at a parabolic rate. - The US cannot endure deflation. This is why the Fed and Biden administration goes to such extreme measures to engineer asset inflation, in hopes of negating economic deflation. - Reflexivity states that when prices deviate too far from objective, underlying fundamentals, prices will reverse to converge back toward equilibrium. - The breaking point is likely not to be either inflation nor deflation. The Black Swan is most likely to be in the implicit short volatility bubble. The world is short volatility in explicit and implicit positions. At any point, reflexivity can crash this bubble in an onslaught of volatility, leading to the unravelling of the monstrous $2.4 quadrillion derivatives bubble. - We have seen the 'Six Sigma event' in the GME short squeeze.... If you see a 'Six Sigma event' in the market, it's not a 'Six Sigma event'. - Hedge fund liquidations and near crises are appearing from the smallest events of volatility. The short volatility trade has been normalized, and institutional investors are incredibly leveraged. - Now the whole world has one language and a common speech: "Buy the Dip". - Tesla and Bitcoin's previous high marked peak euphoria, and the point of maximum financial risk. The current bounce is simply complacency. When the market is in complacency, anxiety will come next. - QE Tapering has already begun. - The tidal wave of volatility to come will be mythical. - The time has come. GLHF - DPT When He broke the third seal, I heard the third living creature saying, "Come." I looked, and behold, a black horse; and he who sat on it had a pair of scales in his hand. And I heard something like a voice in the center of the four living creatures saying, "A quart of wheat for a denarius, and three quarts of barley for a denarius; but do not damage the oil and the wine." - Revelation 6:5-6 And on every lofty mountain and every high hill there will be brooks running with water, in the day of the great slaughter, when the towers fall. - Isaiah 30:25
TVC:USOIL
by UnknownUnicorn1043646
SP500 - Can The Bull Market Really Continue?Idea for SPX: - Stock market is at a 100 year old resistance. - Can it really continue its parabolic bull run? - Here is an interesting fractal of the 20s to 50s, which closely matches with the current market conditions from the late 90s. - Right as the market hit the resistance, it did see a minor pullback and slowed for a year, but then continued its way up glued to the trendline for 10 years afterwards. Past performance does not guarantee future success, but based on this fractal, it is definitely not out of the question. Pullbacks are normal, so it is inevitable that we will have one, but this time, will it turn into more than just a minor pullback? That's a good question. GLHF - DPT
TVC:SPX
by UnknownUnicorn1043646
Oil - Possible Wyckoff AccumulationIdea for Oil: - Oil seems to be setting up for an inflationary shock event in the longer timeframes. - Understanding the trend of oil prices can help in market selection and portfolio construction. - Oil has broken out of a falling wedge. - There was a Wyckoff Spring from Hades as price went negative! - However, lower highs, lower lows, and volatile sell-offs are still a sign of weakness. - Oil has shown that its price can go negative, so a relatively low price should not be mistaken as a bottom. - Something to mention is that Biden has shown his international non-interventionist stance with the Israel-Palestine event, and I speculate that he is turning his attention toward domestic population control, from the UFO disclosures. This is a signal for volatility in oil during his term. GLHF - DPT
NYMEX:CL1!
by UnknownUnicorn1043646
Black Swan - The Housing BubbleSpeculative Idea for MBB (Mortgage-Backed Securities ETF): - Why is there a speculative housing bubble in the middle of a crisis? - "A major catalyst of the general financial crisis of 2008 was the subprime mortgage crisis of 2007, when a rising wave of defaults on home mortgages sent the value of mortgage backed securities plunging." - "They're in trouble right now," as Colleen Denzler, an investment manager at Smith Capital Investors, which has about $350 billion in assets under management (AUM), and who previously was the global head of fixed income at Janus Henderson, told BI. She is now underweight MBS. "Bubbles get popped when things turn around either through some sort of crisis or through a change in what caused them," she said. "This could be a while, and that's how we're positioned," she added. - "Other complex debt securities whose plunging values were a catalyst for the 2008 financial crisis are rising in popularity today. The synthetic CDO, a pool of derivatives linked to various categories of debt, is among them. Pessimists fear that history may be set to repeat itself, and that cautious investors should take cover." - NY Fed Report: Total household debt rose by $85 billion to $14.64 trillion. GLHF - DPT
NASDAQ:MBBShort
by UnknownUnicorn1043646
1
Sentiment Sunday - GoldSentiment Sunday: - Eyes are on gold this week, gold bugs are buzzing about a possible explosive breakout. - Rising material costs signaling consumer inflation, yet Fed's monetary inflation model has not indicated inflation yet. - Mixed sentiment, as Fed is likely to maintain dovish monetary policies. - Energy, Industrials, and Industrial/Capital Goods-related materials showing strength, supporting a 'Reflation' macro quadrant situation. - Poor employment data signaling a possible move toward stagflation. I speculate that the economic data from now will begin to reflect the effects of the pandemic. - Lumber, copper, cryptocurrencies seeing massive gains, speculators expecting the precious metals to finally trail. - Elon Musk stated that DOGE was a 'hustle' in his anticipated Saturday Night Live hosting, causing a correction in the cryptocurrency market. Investors are likely exiting and preparing to move into lagging inflationary assets. - Trend is still not defined, but the bullish case for gold is rather strong. GLHF, DPT Disclaimer: We absolutely do not provide financial advice in any shape or form. We do not recommend investing based on our opinions and strongly cautions that securities trading and investment involves high risk and that you can lose a lot of money. Loss of principal is possible. We do not recommend risking money you cannot afford to lose. We do not guarantee future performance nor accuracy in historical analyses. We are not registered investment advisors. Our ideas, opinions and statements are not a substitute for professional investment advice. We provide ideas containing impersonal market observations and our opinions. Our speculations may be used in preparation to form your own ideas.
TVC:GOLDLong
by UnknownUnicorn1043646
1