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tsptalk's Market Talk
- Thread starter tsptalk
- Start date
Yields and the dollar are down this morning helping prices of stocks move higher.
I can only assume that trading volume would be on the light side, hard to tell at this point in the morning, because of the impact of tomorrow's release of the CPI report.
The market had been ignoring the clear hawkish rhetoric of the Fed until last week when we finally saw some profit taking of the 2023 rally.
I can only assume that trading volume would be on the light side, hard to tell at this point in the morning, because of the impact of tomorrow's release of the CPI report.
The market had been ignoring the clear hawkish rhetoric of the Fed until last week when we finally saw some profit taking of the 2023 rally.
The CPI came in on the hot side but there hasn't been much of a reaction, as of now, in yields and the dollar.
Stocks did reverse strong futures gains before the opening bell and the indices opened sharply lower.
The bulls have stepped in to cut the losses in half, so the bears may have their work cut out for them as they battle the 2023 upside momentum.
On the other hand, the bears know that the Fed can't like this CPI data and they will push the story of higher interest rates, something the bulls were anticipating was coming to an end.
Stocks did reverse strong futures gains before the opening bell and the indices opened sharply lower.
The bulls have stepped in to cut the losses in half, so the bears may have their work cut out for them as they battle the 2023 upside momentum.
On the other hand, the bears know that the Fed can't like this CPI data and they will push the story of higher interest rates, something the bulls were anticipating was coming to an end.
After the bulls easily bought up the morning dip and took the indices above yesterday's highs, the bears made their presence know by pushing back again and sending stocks to their morning lows again. That was quite a move by the bears, but it may be quite a battle and the underinvested will have to decide if they are going to stay convicted to their selling, or if this gives them a slight reprieve to cover shorts and perhaps start buying themselves.
Sentiment has gotten quite bullish, and nearing extreme, especially compared to the early January ratios, so the upside may get tougher, despite some very bullish looking formations in the charts.
Sentiment has gotten quite bullish, and nearing extreme, especially compared to the early January ratios, so the upside may get tougher, despite some very bullish looking formations in the charts.
The warm CPI and now hot retail sales are putting pressure on the theory that the Fed not only could stop raising interest rates, but some have been saying that they could be cutting rates by the end of the year.
This strong data suggests otherwise so the dollar bond yields are moving higher, and the stock market is feeling it.
Technically the bull flags on the index charts are still very much intact.
High yield and the credit market charts are showing some vulnerabilities., however.
This strong data suggests otherwise so the dollar bond yields are moving higher, and the stock market is feeling it.
Technically the bull flags on the index charts are still very much intact.
High yield and the credit market charts are showing some vulnerabilities., however.
Yields are making a higher high this morning adding pressure to the stock market. There is a lot of support starting near 4015 and that will be the next test with the S&P at 4025 right now.
The VIX is up near the 200-day EMA again, it highest level since the start of the year.
The VIX is up near the 200-day EMA again, it highest level since the start of the year.
According to the PCE prices report, inflation is still on the rise, or not decreasing. Now this is of course rear-view mirror data from January. Is this new information to the Fed, or have their actions and daily comments already taken this into consideration.?
I don't know the answer to that except that often the worst data comes out near the lows (or best data near a top) because the Fed is trying to be proactive, and the market reacts well before the data is released, until the data comes out publicly and we get an emotional reaction- positive or negative.
I don't know the answer to that except that often the worst data comes out near the lows (or best data near a top) because the Fed is trying to be proactive, and the market reacts well before the data is released, until the data comes out publicly and we get an emotional reaction- positive or negative.
The 10-year yield is down this morning, helping the stock market, but it remains above that old resistance line. That 3.9% area is holding but we've seen the sideways consolidations become peaks in the past, although there was one exception in late November is consolidating, then resumed the downside. This is important because the direction of the next larger move in the 10-year will probably be in the opposite direction of the next larger move in stocks.
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