← Go back Jul 07, 2023
S&P 500 and real assets benefited from underwhelming non-farm payrolls, but the positive moves including in were erased in strong selling before the closing bell. The greatest issue for buyers this late into the topping process, is that long-dated Treasuries haven‘t moved that much to facilitate such a steep decline in e.g. tech and communications. That means the buyers wouldn‘t have really easy Monday, because the move was a bit more than pre-weekend hedging – yet real assets not following to the downside balances that out. Where does that though leave us macroeconomically and in terms of the bear market rally vs. new bull market debate? Apart from already summed up , and swipe at , let me add that manufacturing recession is quite here, expansion in services ISM wouldn‘t be enough to prevent rise in unemployment to around 5% claims and layoffs say, and that still robust job market together with strengthening oil prices later this year would work to bring up inflation to the 4.4 – 5% range in Dec 2023 – hardly a constellation that would allow the Fed to take its foot off the pedal (besides July, we have 1-2 rate hikes coming by Jan 2024 FOMC). And that means continued pressure on Treasury yields to rise in order to reflect return of inflation, loose fiscal policy and tight Fed underpinning the short end of the curve. Translates into obvious pressure on , still , and disappointing equal weighted index characteristics that make the rally off Oct lows pale badly to true bull markets being born as measured by appreciation after these many months (no, the arbitrary 20% line doesn‘t count for me). That has earnings, P/E and profit margins consequences as of Q3 2023. I hope you had reviewed where I talk these very subjects… Keep enjoying the lively via keeping my tab open at all times (notifications on aren’t enough) – combine with subscribing to my , and of course that (head off to Twitter to talk to me there), but getting the key daily analytics right into your mailbox is the bedrock. So, make sure you‘re signed up for the free newsletter and make use of both Twitter and Telegram – benefit and find out why . Let‘s move right into the charts (all courtesy of ) – today‘s full scale article contains 6 of them. Friday‘s reprieve in and silver is to give way to renewed selling – still, the daily showing in the face of rising yields had been remarkable – owing to the USD weakness. Big picture, metals are still basing, and the ucoming move likely points down. Crude oil cleared with ease $71, and didn‘t lag behind precious metals (function of USD decline?). While I consider it basing, over the weeks and short months ahead, it would embark on an uptrend again – . Long-term bullish factors remain at play – underinvestment in exploration and extraction, aging giant oil fields, limited spare capacity, stubbornly resilient world demand regardless of green policies in the West, shale plays (Bakken or Permian) approaching their own peak etc. upswing had been more muted, and I would say correctly so – $3.72 are to hold still, probably much of the way into Jul FOMC. Thank you for having read today‘s free analysis, which is a small part of covering all the markets you’re used to (stocks, bonds, gold, silver, miners, oil, copper, cryptos), and of the daily premium presenting stocks and bonds only. Both publications feature real-time trade calls and intraday updates. While at my site, you can subscribe to the for instant publishing notifications and other content useful for making your own trade moves. Turn notifications on, and have my (tweets only) opened in a fresh tab so as not to miss a thing – such as extra intraday opportunities. Thanks for all your support that makes this great ride possible! Thank you,
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