• 8 hours Contrarian Investors Are Beating The Stock Market
  • 11 hours Bulgaria’s Revenue Agency Falls Victim To Biggest Cyber Heist In History
  • 14 hours Amazon Faces European Union Anti-Trust Probe
  • 16 hours Commodities Are Having A Stellar Year
  • 1 day Bezos’ Next Big Project Could Be Worth $100 Billion Per Year
  • 1 day 3,600 Years Later, Climate Change Turns Mammoths Into $40M Market
  • 2 days Tesla, Apple Claim China Is Stealing Intellectual Property
  • 2 days EV Giants Duke It Out For Battery Dominance
  • 2 days Tech Billionaire Takes Aim At Google
  • 2 days Chinese Police Bust Largest Ever Illicit Crypto Mining Operation
  • 3 days Expect A Pullback Before Gold's Next Major Rally
  • 3 days Why Interest On Gold Matters
  • 3 days Ten Extravagant Food Items For The Wealthy Only
  • 4 days Why Saudi Arabia Won't Give Up On The Aramco IPO
  • 4 days $32 Million Crypto Heist Halts Tokyo Exchange
  • 5 days Is A Gold Selloff Looming?
  • 5 days Central Banks Are Stashing Gold And Dumping Treasuries
  • 6 days Three Cannabis Trends Flying Under Investors’ Radars
  • 6 days $1.3 Billion In Cocaine Found On JPMorgan Vessel
  • 6 days Amazon Teams Up With Lady Gaga To Win Over Generation Z
Billionaires Are Pushing Art To New Limits

Billionaires Are Pushing Art To New Limits

Welcome to Art Basel: The…

Market Sentiment At Its Lowest In 10 Months

Market Sentiment At Its Lowest In 10 Months

Stocks sold off last week…

  1. Home
  2. Markets
  3. Other

Inflation Bull

Equity markets continue to defy our call for no end-of-year rally as equity investors rush to invest idle cash and not miss out on the positive feedback loop of higher prices. SPX has broken the mid-Sept high at 2,020 leaving behind a series of higher highs and higher lows; the definition of an uptrend. Price is the ultimate arbiter but we cannot ignore other signals if we want to be successful in forecasting price.

Inflation expectations (chart) bounced after testing the January low but are falling again and may get a chance to re-test the lows during the next pullback in equities. A break to new lows would be very bearish for equities.

A close by the yield on the 10 year treasury (TNX) below the February low at 16.75 would be deflationary and bearish equities.

The US Dollar may have printed the expected double bottom during the previous week giving us the cycle low we've been waiting on. A rising Dollar is deflationary which is bearish-equities.

Small Caps have been underperforming during the fall rally and have not exceeded their Sept high. Relative performance (vs. SPX) is breaking down from what may be described as a bearish head-and-shoulders pattern. A bull market without leadership from small caps should be considered suspect.

5-year Treasury Constant Maturity Rate with 5-Year Treasury Inflation-Indexed Security, Constant Maturity
Larger Image


Try a trial subscription at Seattle Technical Advisors.

 

Back to homepage

Leave a comment

Leave a comment