Thread: tsptalk's Market Talk

Stocks are up this morning although the strength is mixed with small caps leading and the Dow and S&P 500 bouncing between positive and negative several times already in the first 30 minutes of trading.

Yields are up sharply again which makes it curious why the small caps are leading.

The chatter is that yields are now moving on economic strength and not inflationary concerns.

We get the CPI tomorrow so that may clear things up.

As I mentioned in today's commentary, the technical picture deteriorated after Thursday's negative reversal but the economic data and earnings season may end up telling a different story.

Yields are down this morning in front of tomorrow's big CPI reading as the investment world braces for data on the inflation front.

Stocks opened higher but have backed off some as we generally see a fade of the opening move in the first 30 - 60 minutes of trading, so it's tough to gauge where it will end up.

The indices are still retracing last Thursday's negative reversal rally, so they are not out of the woods yet.




The dollar is down today again as well, but it may get some pushback here at the 20-day EMA, which has held often this year.

Japan was up last night and Europe is mixed.

Oil is down slightly, gold and silver continue to rally, bitcoin is down sharply after yesterday's big rally.

Yields and the dollar shot up after the hotter than expected CPI report this morning. The 10-year is up to 4.5% and this could be a psychological level for the stock market - at least initially. The closer this gets to 5%, the more attractive the guaranteed return gets as an alternative to stocks.

The dollar is also making a new high for the year.




The S&P 500 is down 1%, which is not an avalanche, but the chart has shown some cracks recently. After falling below the impressive 15-day EMA (green), which is rolling over, it is now trying to hold the 30-day average (orange.)



Small caps are getting hit hard as we might expect when yields are jumping. It is testing its 50-day average this morning but the rising support line did break this morning.

The strength in the dollar is putting pressure on the the price of oil, gold, silver and bitcoin.

A softer than expected PPI Report this morning took the overnight futures off some fairly low levels and into the green, but as the morning unfolded we are seeing more selling and a test of yesterday's lows. That needs to hold or another leg down would be expected. In the case of the DWCPF or S-fund, it is testing its 50-day EMA again.



The 2000 level could turn out to be a neckline of a head and shoulders pattern - we'll see how that develops.

Yields are finding no relief despite the less inflationary numbers this morning, and the dollar is making new highs again in early trading




Oil is down, gold and bitcoin are up.

Japan and Europe are seeing a lot of red in their indices.

The back and forth continues as the market dishes out alternating frustration for both the bulls and the bears. This morning stocks are down following Thursday's big rally. We have charts looking over the precipice of support which, if broke, could change the whole complexion of the stock market.

The S-fund is looking over that 50-day EMA, which...



... has been holding since just after the Fed meeting in early November when rate cuts appeared to be coming.


The dollar is up strongly again this morning so the I-fund is feeling some of that pain and dipped just below its 50-day average. It had been successfully tested a couple of times since its November breakout.




Oil is one of the culprits today as it has moved up $2.57 a barrel this morning to 87.59 as tensions in the Middle East rise. Gold is also up big on the new inflation concerns.

Stocks opened sharply higher this morning but have since given back some of those gains as yields are rising and the dollar is up again.

Israel fended off an attack by Iran and the market was showing some relief. Also retail sales and Goldman Sachs earnings came in better than expected.

The 10-year yield gapped up and this has the small caps lagging again as the S-fund is currently negative while the C-fund is holding onto a modest gain, but fading. The I-fund (EFA) is up big early.




Gold and oil are down. Bitcoin is up after a volatile weekend of trading.