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Treasuries

FINALLY! GOLD COMPLETES THE RISK-OFF *3* - !SHORT EQUITIES!Finally Gold completes the market risk-off 3 for rallying... we not have JPY, BONDS and GOLD all rallying - this completes the set of 3 -riskoff indicators, we are now in full bear mode for stock markets imo.. as you can tell from the US Treasuries and JPY, these riskoff assets have been gaining value for some time, gold has been lagging behind but today following a poor NFP print but STRONG Unemployment print. IMO gold is rallying higher as the probability for a fed hike becomes higher since unemployment is their target measure along with inflation (and not NFP as some will believe). with all 3 riskoff assets rallying this means there CANNOT be enough liquidity in the market to push risk assets (SPX/NAS100/DJ30) to new highs as well - its all but a 0 sum game - the liquidity to push JPY BONDS and GOLD higher MUST have come from risk assets. I believe this will be the end of the modest bull run for equities #downwego probably starting next week. A movement lower in equities at his point is well served - we have many high risk events coming up and i believe people will be getting out of risk and into safety starting next week given 1: fed on the 16th 2. brexit on the 23rd and also BOJ on the 16th (along with a slew of other Central banks also due to declare their monetary policy). Given the above uncertainties/ Risks NOW seems a perfect time for investors to flee to safety and for the SPX to follow suit 5-10% lower in the coming weeks. As per my previous articles this answers all of the questions, we now have enough uncertainty momentum to push gold UP and stocks down IMO.. the paradoxical bonds/jpy AND stocks higher will come to an end in the coming days with STOCKS selling off for at least 4 weeks. PLease see the attached articles for more information.
FX:XAUUSDShort
by QuantumLogicTrading
#Dollar Showing Weakness, Intermediately OverboughtThe U.S. dollar went bid following rhetoric from Federal Reserve officials that a potential rate hike could occur in June, following hotter than expected inflation data. However, after posting on pending technical weakness here, the dollar has retreated slightly over the last few days. Price action as traded neatly within a descending channel on the daily chart, and potential signals of another move downward are pending: The daily RSI has broken through an indicator support level, and the stochastic indicator is signaling a highly overbought condition. If price price action continues to falter, a sell signal below 80 could trigger selling pressure. The DMI is about to form a bearish convergence, which would indicated bearish price action will take over. In order to regain upward momentum, the DXY would have to close above channel resistance near 95.66; 96.55 will be key resistance point in order to challenge 98. If selling pressure does occur, DXY will likely seek out 93.80 (50% fib retracement from current minor uptrend) The long-term macro dollar theme continues to be deflationary. It is important to note, a spike in inflation has been a late cycle occurrence. Every U.S. recession since the mid-1950s has seen an increase in inflation (after previously declining). We must also include that as the global economy continues to slow, global central banks will look to continue monetary easing this will at least support the greenback. Furthermore, as the U.S. economy rolls over, a deflationary spiral is expected to occur. MacroView is still expecting the U.S. economy to reach recession between Q2-3 once final data revisions occur. If you would like to know more about MacroView's products and services, please feel free to message us. As always, comment and post charts. We love to talk markets!
TVC:DXY
by MacroView_Research
1
The Case for USA Electric Utilities, even with Rising USA RatesRunning Alpha Capital Markets observes that higher rates are not always a headwind, as the not too distant record shows that the electric utilities group can outperform and offer a margin of safety. During the last period of higher rates, from mid 2004 to mid-2006, the FOMC hiked rates 16 times, and despite these incremental actions, electric utilities actually outperformed the broad USA equity market indices by a fairly wide margin. The electrics don't start to significantly under-perform until the Fed funds rate passes the yield of the average electric utility stock; and we will be no where near there even after a number of measured hikes. Absolute returns on electric utilities are likely to stay rich, regardless of what interest rates do over the next market cycle. Looking at the average electric utility investor, who are the buy and hold type of market actor, we still have good electric utility yields out there relative to what the Treasuries offer, and on top of that, the electric utilities have attractive balance sheets with good dividend growth and compelling absolute total returns.
NYSE:EDLong
by RunningAlpha1
More downside for TLT after a bounceI recently posted about expected downside for the bond market, based on technicals. As long as we're looking at bonds, why not look at treasuries. The technicals for TLT are in a little more of a "grey area" technically, than corporate bonds. The two scenarios I can see for the wave pattern have very different outcomes. Scenario 1 points to lower prices after small counter-trend rallies, and a break of the rising channel going back to December of 2013. Scenario 2 calls for new highs from here, and a general resumption of the rising channel. My bias leans toward scenario 1 for 2 reasons. 1. Prices have yet to test the lower end of a price channel containing the ABC/WXY corrective pattern from the January highs. As I pointed out in the linked post about bounds, corrective patterns have a tendency to channel. 2. In a WXY pattern, W and Y will tend toward equality, and so far the Y-Wave has fallen short of the price projection at 117.43. In summary, many traders and investors are looking for a major bear market here, which would drive up the price of treasuries as investors seek safety. I've been "cautiously" taking the other side of that view, with a view of stocks needing a healthy correction. Treasuries may bounce a bit here, as uncertainties develop around some stock market selling, but I expect that bounce to be a counter-trend rally, rather than a continued bull market in treasuries.
TShort
by FractalTrader
Nice Risk Reward on U/J Well last night U/J broke below a support zone, and is now retracing , looking to go short at 118.85-.90 with a stop at 76.4% Fib. If 76.4% is broken I will be looking for long opportunities but for now U/J is still a sell for me personally. Profit target at the 161.8% extension zone. Market sentiment supports xxx/JPY shorts with US treasuries dipping below the 2% Yield rate so sentiment has definetely been risk off this week, many factors are to blame for the risk off sentiment, EU QE speculation, US rate hikes, Oil moving lower, Greece, etc. (Yen is a quote on quote safe haven currency) There is also, Japanese fundamentals supporting temporary Yen strength having to do with their year end/new year business cycle, I would go into detail on that but I have not researched it thoroughly enough to go on writing about it. Risk/Reward meets my guidelines at roughly 1:8 . There are US economic data coming out, of medium impact during today's sessions. So just a heads up to keep an eye on that. Happy trading =D
Short
by Daniel.B
1
Market Themes: NO chance of rate hike, NO Deflation - USD This is a year-to-date chart scaled on a percentage basis that outlines the relationship between the US Dollar, 20 yr+ Treasuries, Gold, Energy (think oil, gas etc), the Euro, and the US Real Esate Index. These represent the different investment classes in the market (rate-sensitive instruments, earnings sensitive instruments, and hard assets). As you can see there is a huge disparity with US Dollar, Treasuries, and Real Estate at highs while Gold, Energy, and the Euro is quite low. What this implies thematically is clear: The market currently believes there is NO chance of a rate hike (see treasuries, real estate), that there is NO chance of deflation (see EURO and Dollar relationship, and Gold / Energy underperformance) and, although it is not shown since the chart was getting cluttered, there is no indication that corporate earnings are at risk. Follow this chart because these themes are where you should be focusing your asset allocation.
AMEX:UUP
by SPYderCrusher
2