..higher than expected PCE data, along with new projected GDP contraction and threat of EU retaliation against Mag7 service providers provided strong enough catalysts to disappoint bulls hoping for a sustained rebound recovery.
..the charts look like taking out the recent lows next week, and market participants would be disappointed that Trump is not bluffing and not backing down
..at the close, Dow plunged -716pts or -1.69%, S&P500 -1.97% and Nasdaq a sharp -2.70% with broad selloffs across Mag7 and across the board: Tesla -3.53%, NVIDIA -1.58%, Meta -4.29%, Amazon -4.33%, MSFT -3.02%, AAPL -2.68%,
..remember my post from days ago when I suggested that perhaps Gold may actually move in opposite direction to the equity market, this time being different. Well, it did. Gold took an initial $5-10 hit when the PCE data was released but at the close it was $28 higher at $3085, just slightly below $2 shy of its intraday all time high.
..and while we got a selloff in stocks, AUD Gold stood out, gaining +1.22% to close at A$4907 on the back of stronger Gold and weaker AUD which closed below 63c at 62.87c
..Silver didn't prospect in the face of market adversity, could not shake it and never had, it dropped -0.81% to $34.13, considered reasonably resilient as the fall is below the percentage fall in the major indices, when in the past, it would usually fall more than them. When we see money pouring into Silver once it shoots past $35 and stay above, I think we will have a strong rally in both Precious metals.
...Gold stocks would rise in days when Gold rises along with equities, but don't count on them doing well alongside Gold when the equity market is tumbling. Staying in gold stocks is subjecting yourself to the full brunt of the forthcoming bear market.
...DXY closed down to 104.03 while US 10 yr yield also declined -2.77% to 4.25pc, music to Trump's ears- the 'plan' is working but must bear seeing the market tank.
Scott Bessent definitely is getting his weaker dollar and lower 10-year bond yield. But for the wrong reason if you’re trying to achieve those results without the economy tipping over – which seems to be happening right in front of our eyes (and the global trade war has only now started!).
https://x.com/EconguyRosie/status/1905724862473339380...it was broad-based ugliness for stocks with nowhere to hide: banks 2-3% down, lithium 3-6% down, travel stocks 2-4% down, copper stocks 1.5-6% down, coal stocks 3-4% down, oil and healthcare stocks more modest falls <1%
Ok, that's the close. The chart of the week: S&P Tech the lowest level since last August and VIX back above 20.
https://x.com/SuburbanDrone/status/1905712267787932000Nasty for the S&P 500
https://x.com/Barchart/status/1905720898432438475S&P 500 on track for its worst month since September 2022
https://x.com/Barchart/status/1905730526704734716Atlanta Fed is now projecting that Q1 GDP will be -2.8%… a large contraction. It’s negative even “gold adjusted” 4 weeks ago it was +2.3% 8 weeks ago it was +3.9%
https://x.com/Geiger_Capital/status/1905634566393790948As warned with CONVICTION,
$SPX got CRUSHED beginning the next major wave down. Everything is going exactly as projected, and lean remains we see further downside to 5400 w/ potential to extend all the way down to the 5120. As long as we remain below 5650, we should trace out 5-waves down on the fractal timeframe.
https://x.com/TriggerTrades/status/1905712323538612722...he isn't at all perturbed by the unfolding market selloff
BREAKING: President Trump says he will be announcing new Pharmaceutical tariffs "soon." We expect next week to be the most volatile week of the year so far.
https://x.com/KobeissiLetter/status/1905718150202798350..oh!oh! credit spreads are widening now
Junk bonds fell again today as Treasuries rallied, signaling rising spreads and worsening credit conditions. A volatility event appears to be unfolding in my view.
https://x.com/TaviCosta/status/1905732525320011900Gold/SPX ratio now at 0.5528 closing in to confirm Capital Rotation Event (at 0.58)
..Yuriy on technicals, a >25pt drop on the S&P500 next week is easy peesy; when you have a big selloff like this $1T selloff on Friday, it gives market participants time to reflect and capitulate over the weekend ahead of 'liberation' day next week.
..Once below 5555, the algos take over and the falls will likely be fast and furious. The market will then test Trump's resolve to unleash liberation day in its original intended form.
Brutal rejection at 5850, which was a former support. Very bearish. If ES drops below 5555, expect a meltdown.
https://x.com/yuriymatso/status/1905628084000489641...final word from David Rosenberg
As everyone is laser focused on the auto tariffs and the coming Liberation Day (indeed, a liberation from Reaganomics … how did that happen?), and the likely retaliatory measures, there is another force at work that investors should be assessing. It is the start of this world travel boycott underway against the United States. Goodbye Statue of Liberty (speaking of liberation) and hello to the CN Tower. This is actually happening. Maybe CNBC will ask Peter Navarro next time he is on about the laws of unintended consequences. The travel and tourism sector touches over $1 trillion worth of GDP and supports nearly 20 million jobs. It dwarfs the auto industry. After watching the Bloomberg screens yesterday and today, Mr. Market may be catching on to the grim reality that the U.S. economy is going to be joining the rest of the world on the down escalator.
https://x.com/EconguyRosie/status/1905680743885676588
