Bought the close, stop down yonder.
Gotta love ZERO RISK in the SP500 = $$$
- Thread starter makloda
- Start date
Ugly close.
Possible this week they try to defend 2700 by friday close? Then 2600 next friday? Originally looking at 2680 this friday close, but possible it closes 2700?
Possible this week they try to defend 2700 by friday close? Then 2600 next friday? Originally looking at 2680 this friday close, but possible it closes 2700?
I've mentioned this elsewhere on ET, but from where I am sitting, stocks seem to be in a no-win situation....high-valuations, full-employment, consumers up to their necks in debt, 10th year of economic expansion........coupled with the Fed tightening, unwinding billions in it's bond portfolio, and Trump's tax-plan a fiscal nightmare, means that higher rates are almost assured at this point....any piece of good data that from 2009-2017 would be seen as driving stocks higher will now first be seen as driving yields higher....not sure how stocks can escape it - especially perched up high at these valuations.
I agree in terms of fundamentals and everything being priced in. But it doesn't mean it can't go higher for the short to medium term.
What's most important every trader asks themselves is when the top is in, and when the bottom is in. All permabulls and permabears turn to pigs being a one trick pony buying every dip or selling every rip as the only skill in their repertoire. So we gotta ask ourselves when the inflection point happens. Many don't think this is the top top yet. But that doesn't mean short term we can't test 2300 even this year, but bounce back to ATH by end of year in time for 3000.
Can't argue with anything you've said there - I just think it is alarming to see how stocks are reacting to small moves in the treasury market.
Take today for example. The Fed releases a "nothing has changed with our plans" Fed minutes report, and the /ES initially ramps up, only to tank 50-handles in reaction to the treasury sell-off. Haven't seen a selloff like that in reaction to Fed minutes in a long time.
Maybe it's all meaningless, but it seems to me that stocks are having to some pretty violent downside moves lately in reaction to relatively small increases in treasury yields.
Why is it alarming only that it ran to ATH and fell? Why didn't people ask why it ran up to ATH in the first place? People will always ask on a -5% day, "does it deserve to drop 5% today when nothing changed between today and yesterday?". Well, why not ask whether the market deserved to be at that level in the first place. So it's not shocking if something overvalued drops to less overvalued over little to no news at all.
The bonds have now broken a multi decade up trend support line. It's probably gonna look ugly unless and until they QE again.
Daily price action is always dominated by algos. And they have a tendency to head fake on economic data dates, like FOMC, CPI numbers, etc - to run stops and to trap bears/bulls. It's hard to trade the noise. Like today, people were gloating after the print and ramp, calling for 2800, and then mere 1 hour later they are licking their wounds with their heads down as market moved decidedly lower.Trading longer term trends might be easier for some because despite daily noise, it will move to it's target.
Tomorrow it's an any direction kinda day....with the 10 year continuing it's upward trend you just don't know what to expect...I still believe we had back to lows set just 2 weeks ago...more than 2/3 chance in my opinion that occurs.