The Week That Was
No, the subject isn't about last week - although Friday turned it into a doozy. It's about this week, the week I'm taking "off."
It's a good week for vacation; always has been. The week before Labor Day usually kind of drifts along. Lots of traders are on vacation. Volume is down. People are either sopping up the last days of summer, or sighing about the fact that summer's just about done.
However, when you run a small business, there's not "OFF"; if anything, you try to manage "off." So that's what I'm attempting for these last five days of summer 2019.
With good systems, back-up, and people you can rely on, you can, of course, get some serious R&R going. Given that we've got all that, R&R it is. With that in mind, how about a few random thoughts before Labor Day catches up with us?
First, Friday. Trump tweeted and stocks nose-dived. They say it's all about the Trade Wars. In the same way, they're saying today's bounce is about Trump's claim that the Chinese government wants back to the negotiating table (although a Chinese official has said he doesn't know what Trump's talking about). But here's where we've all got to take a deep breath.
While the news does indeed move markets on a short-term basis (short as in, typically 1 day), you don't want to waste time listening to the daily drone of stocks-fell-when-the-President-said, or bond-yields-rose-in-response-to-Fed-Chief-Powell's-comments-about. If you're interested in trends for a particular item, you've got to expand your horizon beyond a day, a week, or a month.
With that in mind, here are the current trends as we see 'em:
Stocks have been locked in a trading range with a bottom around 2840. When they eventually break out of the range - which they will - if it's to the downside, we could get a significant (and maybe scary) correction. The upside, though may signal that the "Melt-Up" folks were right after all.
Bonds really do seem to be bulling it up re their prices. After remaining above the 2.11% mark since July 2016 - possibly signalling the end to the bond markets 30-year + bull run - the 30-year absolutely blew past that and has settled below 2%. In fact, so much so, it's not crazy to wonder whether the yield will eventually head to 1%. That would be something.
And our friend Gold can't seem to rest. All indicators we follow have been saying for at least two weeks now that it should correct, at the very least trade within a tight range for weeks to come. It started doing just that. Then Friday hit and, as stocks plummeted, the price shot from under 1500 right back into the the 1520, eventually the 1530 range. Now it's really overbought. But go tell that to Gold.
As for the comment about this being a good week for vacation, given past history of lackadaisical markets, just remember we've got the Great Tweeter Trump as POTUS. Depending on his mood swings this week, market activity could be, at the very least, above average.
I'm still taking vacation.
It's a good week for vacation; always has been. The week before Labor Day usually kind of drifts along. Lots of traders are on vacation. Volume is down. People are either sopping up the last days of summer, or sighing about the fact that summer's just about done.
However, when you run a small business, there's not "OFF"; if anything, you try to manage "off." So that's what I'm attempting for these last five days of summer 2019.
With good systems, back-up, and people you can rely on, you can, of course, get some serious R&R going. Given that we've got all that, R&R it is. With that in mind, how about a few random thoughts before Labor Day catches up with us?
First, Friday. Trump tweeted and stocks nose-dived. They say it's all about the Trade Wars. In the same way, they're saying today's bounce is about Trump's claim that the Chinese government wants back to the negotiating table (although a Chinese official has said he doesn't know what Trump's talking about). But here's where we've all got to take a deep breath.
While the news does indeed move markets on a short-term basis (short as in, typically 1 day), you don't want to waste time listening to the daily drone of stocks-fell-when-the-President-said, or bond-yields-rose-in-response-to-Fed-Chief-Powell's-comments-about. If you're interested in trends for a particular item, you've got to expand your horizon beyond a day, a week, or a month.
With that in mind, here are the current trends as we see 'em:
Stocks have been locked in a trading range with a bottom around 2840. When they eventually break out of the range - which they will - if it's to the downside, we could get a significant (and maybe scary) correction. The upside, though may signal that the "Melt-Up" folks were right after all.
Bonds really do seem to be bulling it up re their prices. After remaining above the 2.11% mark since July 2016 - possibly signalling the end to the bond markets 30-year + bull run - the 30-year absolutely blew past that and has settled below 2%. In fact, so much so, it's not crazy to wonder whether the yield will eventually head to 1%. That would be something.
And our friend Gold can't seem to rest. All indicators we follow have been saying for at least two weeks now that it should correct, at the very least trade within a tight range for weeks to come. It started doing just that. Then Friday hit and, as stocks plummeted, the price shot from under 1500 right back into the the 1520, eventually the 1530 range. Now it's really overbought. But go tell that to Gold.
As for the comment about this being a good week for vacation, given past history of lackadaisical markets, just remember we've got the Great Tweeter Trump as POTUS. Depending on his mood swings this week, market activity could be, at the very least, above average.
I'm still taking vacation.
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