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What Sticks to the Barn Door is What Matters 3/14/23

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If the bond rally were to continue, the problem of bank runs would be self mitigating. That's because many of the assets that would need to be sold, could be sold at a profit. But the announcement of a Fed-Treasury-F-DIc bailout changes the equation. The bond rally stopped yesterday. Stocks are rallying today and bonds are selling off. If whales see the big bailout as inflationary, they're going to sell bonds into a massive wave of new supply. The question then becomes how much money the Fed will print in new QE to absorb it, and how much additional consumer inflation would result.

Lots of unknowns, which is why we resort to TA now in the short run. To be in the right position if some of this stuff they are throwing against the barn door sticks. 

From the standpoint of the hourly chart of the 10 year yield, the key pivot point is around 3.68-3.73. Get above that and a renewed selloff would send yields up and prices down. If they can stick it below that level, then there's a chance of a self mitigating situation for the banks. The greater the fear, the more the situation would self correct with a buying panic in bonds. But if the Fed/Treasury/F-dic ploy dampens the fear, the situation would become highly "fluid". As in lighter fluid.  Systemic Meltdown Under Way As Dead Bodies Finally Start Surfacing March 12, 2023

-j78x

On the hourly chart of the ES 24 hour S&P futures we have a little uptrend line to watch that goes from around 3875 at the NY open to 3890 at the close. Stay above that and hope springs eternal. Below that, and crash potential reawakens.

3895 is also an important resistance level. If they clear that, next target would be the 3920s.  But the really big R level is around 3940. Clear that and you'd have a nice base breakout to build upon. Looking the otter way, the key sport levels are 3855 and 3810. Break those and the fun starts for the bears. 

Right now, they're in a triangle, or just breaking out if they stay above 3880. However, they would hit the DIck Trickle Memorial point in about 2 hours at 3875, which would signal a market in perfect equilibrium. Then nothing would happen until the theater fills with popcorn munching patrons and somebody yells FIRE.  

-j7m3

Looks like BTC is a safe haven. What a base if it breaks out here. That could yield a $5k profit in the blink of an eye. This is a daily chart. 

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Gold looks very interesting. This is also a daily chart. Gold Works On High Base March 14, 2023

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The more I think about it, opening the discount window to all banks for qualified paper at par with no haircut, and guaranteeing all deposits is a major policy change that will flood the system with liquidity and enable the banks to endlessly absorb whatever amount of paper the Treasury puts on the market. 

Hyper inflationary. 

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hyper moral hazard. It compounds all the policy errors of the past 30 years to the moon. 

What a shit show we've become. It's no wonder the Nazis are in ascendency everywhere. 

Sickening. 

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3 minutes ago, DrStool said:

The more I think about it, opening the discount window to all banks for qualified paper at par with no haircut, and guaranteeing all deposits is a major policy change that will flood the system with liquidity and enable the banks to endlessly absorb whatever amount of paper the Treasury puts on the market. 

Hyper inflationary. 

Yes, I think so too.

All banks which have Treasuries in their fartpolio qualify for that. All but some minor banks maybe have that. As a welcomed side-effect those minor banks will get merged or disappear and the concetration process in the banking landscape goes on.

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