Rising wedge breakdown
And so it came, S&P 500 was acting weak into NFPs (low figure, and forget not two serious prior months‘ revisions), and put up a good fight for only a while then. Trying to come back in spurts, the most predictably reacting markets were as I wrote, the dollar and yields. Gold (rather than silver) rocketed higher without much of a pullback.As I‘m discussing in Saturday‘s extensive video, USD and yields moves are essential, so how do these fit the relaxing financial conditions?
How does it fit the inability of great earnings to push up S&P 500 on a lasting basis? Troubles with financials? Is the USD recovery biting after all? Why didn‘t stocks though do better when the dollar tanked Friday (as I expected it to)?
NFPs significantly underwhelmed, private payrolls – and unemployment rate rose too while participation rate ticked lower. Yet what was odd and I mentioned it to clients first, was that interest rate sensitive plays didn‘t rally following the data – there was some improvement since, but fizzled out across all equities – and thus the rising wedge break was born.
Teaser – is it about rates differential, or what‘s next about to happen with USD? Economy tanking?
Author
Monica Kingsley
Monicakingsley
Monica Kingsley is a trader and financial analyst serving countless investors and traders since Feb 2020.
