DrStool Posted November 15 Report Share Posted November 15 Whenever there's a big rally, it always feels that way, but let's step back a minute and recall what happens when a market crosses an oft crossed trading range. Nothing. After ground has been trodden time and again, it becomes a well worn path, easy to traverse. Same in the market. The market has crossed at least part of yesterday's range on 37 days since June. That means there's not that much stock for sale as there was the first time it crossed. So when triggered the market gaps across most of the empty spread between offer prices, until it starts to hit that overhead supply. Then we get to find out just how strong the rally is. Not based on yesterday. That said, there was plenty of technical warning that the market was primed to go higher. On October 31 I abruptly reversed what had been a bearish view of the technicals. Then on November 6, I warned again. On November 7, my swing trades list added more buys, and only buys. Then this Monday before the market open, I headlined again Meltup Gonna Take You Hiya . And likewise in the pre market- Loading Up on Buys. So there was plenty of warning that something like yesterday was coming, and maybe more. But can we conclude that it means new highs directly ahead? I will leave that for the next set of cycle projections in the Technical Trader report to be posted in the coming weekend. For our usual pre market look at the hourly ES, 24 hour S&P futures, the 5 day cycle projection now points only to 4525. However, there's a trendline convergence at 4530 a couple of hours from now that is also a likely pivot point. And the 2-3 day cycle projection looks like 4545-50. Hourly oscillators are well overbought, but that doesn't mean anything. The trend is your friend until at least a break of the new meltup channel line rising from 4515 as of 7 AM NY Time to around 4530 in the 10-11 AM hour. As long as that line stays intact, gonna take you hiya! Over in bondland, a cycle projection on the 10 year yield points to 4.25-4.30. The mid month coupon settlement today is very small. With selling pressure less than usual, and the bond cognoscenti having decided that repricing is in order, there's no reason to expect immediate reversal of the bond rally. But Treasury Supply Ain’t Going Away, so after this respite, be wary, things could get hairy. Even the lowly yellow relic popped on yesterday's low inflation news. Go figger. For moron the markets, see: Gold Has Lost Its Mojo and Is Now in Danger November 14, 2023 Swing Trade Screen Picks – Loading Up on Buys November 13, 2023 Meltup Gonna Take You Hiya November 13, 2023 Gold Bullish Pullback But Miners Are Doubtful November 8, 2023 Fuggedaboutit! Treasury Supply Ain’t Going Away November 5, 2023 Which to Believe, the BLS or Actual Tax Collections November 3, 2023 If you are a new visitor to the Stool, please register and join in! To post your observations and charts, and snide, but good-natured, comments, click here to register. Be sure to respond to the confirmation email which is sent instantly. If not in your inbox, check your spam folder. Link to comment Share on other sites More sharing options...
fxfox Posted November 15 Report Share Posted November 15 Link to comment Share on other sites More sharing options...
fxfox Posted November 15 Report Share Posted November 15 PPI breaking down. We gonna go directly form inflation to deflation. Link to comment Share on other sites More sharing options...
DrStool Posted November 15 Author Report Share Posted November 15 56 minutes ago, fxfox said: PPI breaking down. We gonna go directly form inflation to deflation. Something I have been harping on for months. The CPI overstates inflation because it does not measure housing properly. Link to comment Share on other sites More sharing options...
DrStool Posted November 15 Author Report Share Posted November 15 And the other thing is that all of the inflation measures have been directly correlated with the Fed's SOMA with a lag of about 6-12 months. Link to comment Share on other sites More sharing options...
DrStool Posted November 15 Author Report Share Posted November 15 5 day cycle projection now 4520, done. Link to comment Share on other sites More sharing options...
DrStool Posted November 15 Author Report Share Posted November 15 2-3 day cycle projection has dropped back to 4525. Close enough for government work. Link to comment Share on other sites More sharing options...
DrStool Posted November 15 Author Report Share Posted November 15 OK. Let's take a mooment. Link to comment Share on other sites More sharing options...
SiP Posted November 15 Report Share Posted November 15 Deflation -> New ATH on NQ and ES. Its really simple. BUY. Link to comment Share on other sites More sharing options...
WTF Posted November 15 Report Share Posted November 15 1 hour ago, SiP said: Deflation -> New ATH on NQ and ES. Its really simple. BUY. Disinflation... maybe Deflation... not a chance Link to comment Share on other sites More sharing options...
fxfox Posted November 15 Report Share Posted November 15 1 minute ago, WTF said: Disinflation... maybe Deflation... not a chance Correct. My guess is that the FED will not start some kind of QE again before even a blind sees that we are in a deflation. Under disinflation regime - in which we are already apparently - they will go on with QT. Link to comment Share on other sites More sharing options...
DrStool Posted November 15 Author Report Share Posted November 15 90 years since we've had deflation. If there's one thing central bankers have learned, it's how to prevent deflation. Historically, deflation is usually associated with debt collapse. Circular cause and effect. Link to comment Share on other sites More sharing options...
fxfox Posted November 15 Report Share Posted November 15 16 minutes ago, DrStool said: 90 years since we've had deflation. If there's one thing central bankers have learned, it's how to prevent deflation. Historically, deflation is usually associated with debt collapse. Circular cause and effect. In 2000-2003 we were not far away from it and in parts of 2008/09 we had deflation. But yes, no say „raging“ deflation like in the 1930s. Link to comment Share on other sites More sharing options...
fxfox Posted November 15 Report Share Posted November 15 Cisco and Palo Alto throw hand granades in the afterlife Link to comment Share on other sites More sharing options...
SiP Posted November 15 Report Share Posted November 15 Deflation is bullish, same for disinflation. Low rates will increase bigtech valuations. Same big 5,6 or seven will move markets. nvidia on ath almost guys. Wake up. Link to comment Share on other sites More sharing options...
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