This yield spike is now pounding Tech more than the Dow, as one would expect. We see here that when the % of Nasdaq above the 200 dma gets down to ~10% that has been a reliable rally point. But in 2022, there were two false dawn rallies (red circles). Brief, but tradable.
Like the Pavlovian dogs, retailers return to buy the dip (BTD) only to be blindsided by algo dumping into late session
CTAs will dump billions worth of stocks over the next week in EVERY SINGLE SCENARIO warns Goldman Sachs
..quite like Israel will strike over the weekend to reduce casualties. So expecting edginess to amplify over next 2 trading days, and the S&P500 5,000 mark is under threat.
ISRAEL CONSIDERED STRIKING IRAN ON MONDAY BUT DECIDED TO WAIT, OFFICIALS SAY The Israeli war cabinet on Monday considered giving the Israel Defense Forces (IDF) the go-ahead for a strike against Iran. But later that night, a decision was made not to go through with it "for operational reasons," according to two Israeli officials.
...market narrative has certainly changed so drastically from 6x expected cuts to NONE in 2024. This news must have derailed Gold and Silver's momentum march earlier in US morning trading session, with Gold failing a near $2400 bid to trade now at $2365 while Silver back to $28.23 from an earlier $28.80.
Goldman's trading desk (Lee Coppersmith) noted that for the first time all year, it feels like the market is starting to question the strong growth narrative on the back of weaker earnings this AM: ASML -8% spilling into all Semis; JBHT a bellwether transport -7.5% and KNX -3.5% cut their forecast; Industrial REITs (GSSIREID) -3.2% on back of a neg print in the space. All of this weighing on the Momo trade (GSPRHIM) -2%.
Stocks were sliding early on after the cash open but at around 1055ET the following headline hit: STRIKING IRAN'S NUCLEAR FACILITIES 'ON THE TABLE', SAYS EX-MOSSAD INTELLIGENCE CHIEF - SKY NEWS which took stocks down aggressively.
...But Oil is telling us it is more worried about Demand Destruction than it is about a potential Middle East conflagration affecting oil supplies. Because the belief is that Israel will avoid to hit Iranian oil assets and does not believe that Iran will close the Straits of Hormuz. It is somehow dumbfounding to think that we can so precisely know how a conflict that isn't intended to be one could unfold. We have no idea, can only hope the tit-for-tat does not become an unintended full blown war- the warring parties are playing with real fire, if it stops (which we hope) it must be unprecedented (yet we truly live in unprecedented times).
BREAKING: Oil prices are now down nearly 10% from their highs as fears over higher interest rate policy spread. With markets now seeing less than 2 rate cuts in 2024, demand outlook is questionable. This has put oil prices at their lowest level since March 28th. However, prices are still up more than 15% from their February 2024 lows. The case for a "soft landing" seems to be losing hope.
Still IMO can't see ANY wisdom in buying over this 2 days of anything while the world waits for what happens this weekend, and with the S&P500 on the cusp of breaking 5k. There are certainly better times to be a contrarian.
