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S&P 500 rebounded on underwhelming JOLTS data just as I looked for the index to go up, overcame the key 4,575 support turned resistance, but got rejected at more crucial 4,585 level. The rally was driven by the Magnificent 7, resp. Nasdaq again – and there are signs Russell 2000 is starting to struggle. The pullback in cyclicals – where it matters most (KRE, XLF, XLI, XLRE) had been still orderly, which paints a bit confusing picture for quite a few days before the nonfarm payrolls and especially the nearest FOMC. Nimble traders have an advantage in the remaining days – unless you want to stick with the big picture assessment of mine – therefore, I‘ll present those views below as for clients as it would be impossible to capitalize on the moves thanks to daily articles only..

Let‘s move right into the charts – today‘s full scale article contains 5 of them, featuring S&P 500, credit markets, precious metals and oil.

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Credit markets

Chart

Bonds are strengthening, and risk taking is still getting rewarded. When the dollar start sputtering – that could be first close to EURUSD 1.0730 – I‘d be looking for yields to rise a bit for a short while again. The trend is though clear – yields are to be retreating.

Talking about rewarding risk taking still, junk bonds are to outperform quality (Treasury) ones – and now, we‘re on the doorstep of slowdown in these trades – one that wouldn‘t disrupt the upswing if you‘re patient (this year bonds are going up still).

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All essays, research and information represent analyses and opinions of Monica Kingsley that are based on available and latest data. Despite careful research and best efforts, it may prove wrong and be subject to change with or without notice. Monica Kingsley does not guarantee the accuracy or thoroughness of the data or information reported. Her content serves educational purposes and should not be relied upon as advice or construed as providing recommendations of any kind. Futures, stocks and options are financial instruments not suitable for every investor. Please be advised that you invest at your own risk. Monica Kingsley is not a Registered Securities Advisor. By reading her writings, you agree that she will not be held responsible or liable for any decisions you make. Investing, trading and speculating in financial markets may involve high risk of loss. Monica Kingsley may have a short or long position in any securities, including those mentioned in her writings, and may make additional purchases and/or sales of those securities without notice.

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