We have an interesting situation, at least for the following 6 weeks...After the jobs report, the market is repricing the timing of tapering and eventual rate hikes it would seem. Financials had underperformed for some time, and $QQQ and $SPY moved higher thanks to growth names regaining strength, while bond yields were falling and a big unwind of losing yield curve steepener bets were unwinding. I had pointed out the strength in growth and bonds before, and rotated away from value and financials/energy when I figured out the reflation move had ran its course.
At least financials are prone to do very well for the next few weeks, as the weekly uptrend in $TLT expired, and predicts a 6 week sideways or down move in bonds, which is connected to mean reversion following a furious move caused partially by the unwinding of big yield curve bets. News of the hedge fund that took the hit were recently published, which made me think the move in the yield curve is overdone and bound to mean revert. This will favor US banks for some time again. We also observe this behavior in the $DJI chart here, and the $SPY and $QQQ weekly charts.
Both $SPY and $QQQ have weekly trends that expire in the next 2 weeks, which can lead to a sideways or downside move after the last short term upswing takes a breather.
I'm still bullish longer term overall, in names like $AAPL, $TSLA and $NVDA to name a few, but they might correct or consolidate in two weeks, while US Banks soar.
The trend will likely go back to lower bond yields and outperformance of growth later on, but for now it is the time of the $DJI to shine over $SPY and $QQQ, specially in 2 weeks from now.
Cheers,
Ivan Labrie.
At least financials are prone to do very well for the next few weeks, as the weekly uptrend in $TLT expired, and predicts a 6 week sideways or down move in bonds, which is connected to mean reversion following a furious move caused partially by the unwinding of big yield curve bets. News of the hedge fund that took the hit were recently published, which made me think the move in the yield curve is overdone and bound to mean revert. This will favor US banks for some time again. We also observe this behavior in the $DJI chart here, and the $SPY and $QQQ weekly charts.
Both $SPY and $QQQ have weekly trends that expire in the next 2 weeks, which can lead to a sideways or downside move after the last short term upswing takes a breather.
I'm still bullish longer term overall, in names like $AAPL, $TSLA and $NVDA to name a few, but they might correct or consolidate in two weeks, while US Banks soar.
The trend will likely go back to lower bond yields and outperformance of growth later on, but for now it is the time of the $DJI to shine over $SPY and $QQQ, specially in 2 weeks from now.
Cheers,
Ivan Labrie.
评论:
An example is $WFC:
Last rally was from a weekly signal on April 13th to May 21st or so.
评论:
It happened during this drop in $TLT vs $IEF (simple way to show the curve steepening move)
评论:
Off to a good start.
