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Nothing Has Happened Yet 9/17/20


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So far, it's just a triple bottom, and nobody knows whether it breaks or it holds. But if you look closely, if it holds here, it's 3 higher lows on the ES. So unless they take out 3309, nothing has happened yet. It's just a downtrend within an uptrend within a downtrend within a flat trend. In other words another garden variety bubble consolidation where the dealers are shaking the trees to pick up the low hanging fruit to replenish their depleted long inventory. 

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Call me jaded in my old age, but this looks bullish. Fractionally higher low. 5 day cycle projection of 3315 done. Dover sole indicators in position for upturns. 

That said, if the rally fails, and they subsequently take out these lows, it's going to be beautiful. 

tvc_16a9bfcef281324ac1fe517f657b88c6.png

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My understanding - or, misunderstanding - is that the lumber mills massively reduced capacity/inventory in spring in anticipation of leaner times and diminished demand. 

But then... funny story. The US gubmint incurred trillions of dollars in debt, and demand for lumber remained robust.

So, if you are going to point to lumber price as an inflation indicator, please be prepared to do so again in 6 & 12 months' time....

That is, when mill-capacity & demand re-equilibriate.

https://www.constructiondive.com/news/lumber-prices-soar-due-to-shutdowns-higher-demand/583899/

...or after a couple of weeks.

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