tsptalk's Market Talk

[Bullitt]

If it does start to pullback and try to fill that open gap, we could see a relief rally in stocks.

What do you think, yields cooling into next week? $TNX looks a bit more indicative of a turn than $TYX.

 

[tsptalk]

Yeah, both charts look peaky, at least for short term.

Did you see the dollar?

 

[Bullitt]

Yeah, that's another thing. Huge reversal and looking like the H&S pattern was completely negated.

Looking at the big picture though, it shouldn't be bearish that rates are returning to pre-covid levels. It's just going to take some time for carry trades and momentum strategies to adjust.

 

[tsptalk]

Reversals today - yields falling some again today after Thursday's reversal, credit (HYG) up big, and VIX is down 16% and back below the 200-day EMA.

 

[tsptalk]

The 10-year yield is down again today. HYG (credit market), which was up big yesterday, is flat to slightly lower, and the VIX is basically flat, so it looks like a typical digestion of yesterday's gains so far. If we start to see 50% of yesterday's return given back, that would change things.

 

[tsptalk]

The transports don't seem overly concerned about the rest of the market volatility. If it holds, it would be a new all time closing high. But that 13,700 level is getting tough.

 

[tsptalk]

What a difference a day makes. We have some chinks in the armor this morning in the Transports' chart:

 

[tsptalk]

David Tepper is getting bullish on stocks, believes rising rates are set to stabilize

Tepper, founder of Appaloosa Management, said it’s very difficult to be bearish on stocks right now.

He thinks the sell-off in Treasurys that has driven rates higher is likely over.

https://www.cnbc.com/2021/03/08/dav...lieves-rising-rates-are-set-to-stabilize.html

 

[tsptalk]

The action looks good as some indices recapture more moving averages. Morgan Stanley however apparently says there more to go - at least in the Nasdaq saying it "should test" the 200-day average??

 

[Bullitt]

Transports rollin' higher.

 

[tsptalk]

Nearly a failed breakout, however...

 

[tsptalk]

S-fund index gapped up this morning, but is trying to fill that gap already. That's fine, but a close above the 20-day EMA and that descending resistance line would be most bullish.

 

[bleeck]

The GAP being filled today would be nice for the next leg up.

 

[Whipsaw]

Would the S-Fund making it back to the last month's high be considered a double top?

 

[Bullitt]

Remember back when I fund was all the rage? People would figure out it's fair value on a daily basis and it was where everyone wanted to be. Nowadays S fund gets all the likes.

 

[tsptalk]

Would the S-Fund making it back to the last month's high be considered a double top?

Sorry for the late response, WS. For a short-term dip, maybe, but the prior peaks were so recent that it's not really considered a top here. Could the S&P dip back a few because of the DT? Sure, but you can see prior breakouts might last a day or two before it occurs.

Double tops are more effective when reaching a level not hit in months or even years (see oil chart at bottom). So for the S-fund, it may depend on how long it takes to get back to that 2250 area.

Better example of Double top

 

[tsptalk]

There they (yields) go again...

 

[tsptalk]

The Nasdaq is trying to hang onto the 50-day EMA that it recaptured on Thursday.

 

[tsptalk]

The good and the bad. Yields are down, helping stocks some, but HYG (credit market) is still struggling, and that's not a great sign.

 

[tsptalk]

Inverted H&S looks bullish, but it could first back and fill in that right shoulder. Technically, it could be considered completed, but there is a small open gap in there so there may be more work to be done before it tries to break out.