Big Day fo USDCAD on Tuesday with the release of CPI See the detailed preview: *(scroll below as USDCAD bounced off support)
US 10 Year Treasury Bond – Some downward momentum
This chart shows the price of a 10-year bond and is the inverse of what it yields so when bond prices go down yields go up.
With China’s economy struggling and the government looking to provide a lifeline to the ailing property market, the conspiracy theorist would say watch out to see if it uses some of its 3 trillion in fx reserves for this purpose (implies selling US treasuries..
Another conspiracy theorist would say given the economic tensions with the US China might also be looking to further diversify some USD holdings into other currencies or assets.
Whatever the case US bond yields are creeping higher but as per this chart, prices would need to break the support line to suggest a more pronounced backup in yields.
XAUUSD 1 HOUR CHART – PAUSED ABOIVE 2400
While the breakout levels at 2417-30 did not provide support, chart support at 2403-05 did hold (low 2407).
This suggests 2400 will hold the key to what comes next with support on deep dips as long as it holds.
On the upside, the Powwer of 50 level at 2450 cited earlier (timely post, scroll below) now makes this a key technical level as well.
US500 1 HOUR CHART -Damon Speaks
Equities continue to trade in unchartere waters and in US500, seems dependent on 2300 holding to keep the risk pointed up.
There was a small hiccup today when JP Morgand CEO Jamie Dimon said they are not going to buy back a lot of stock at current prices. Just something to keep an eye on if this spreads elsewhere.
Most internal metrics with stocks are still on the defensive but the volume ratios are hanging in there so I would not discount the potential for stocks to hold near or below current levels and the Euro in tandem. Shorts in Eu and Aud were exited this morning. Overall risk on remains but not strongly to this point. Preference at Monedge is the long bias when appropriate unless there is widespread adjustment.
Jeff Cox
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* The federal IOU is now at $34.5 trillion, or about $11 trillion higher than where it stood in March 2020.
* Chatter has spilled into government and finance heavyweights, and has one prominent Wall Street firm wondering if costs associated with the debt pose a risk to the stock market rally.
* The CBO estimates that debt held by the public compared to GDP will rise to “an amount greater than at any point in the nation’s history.”
* Fed Chair Jerome Powell said recently that “this is something that elected people need to get their arms around sooner rather than later.”
Soaring debt and deficits causing worry about threats to the economy and markets
thanks jeff !
USDJPY 4 HOUR CHART – A CASE FOR A RETRACEMENT
A CASE CAN STILL BE MADE THAT THE REBOUND FROM 151.85 IS STILL A RETRACEMENT AFTER PAUSING BELOW 156.98 = 61.8% OF 160.16-151.85
wITH THAT SAID, 155 STILL HOLDS THE KEY TO ITS TONE GOING FORWARD.
oN THE DOWNSIDE, 155.97 AND 155.24 STAND AHEAD OIF 155.
WHATEVER, THE CASE, THE joy HAS BEEN THE OUTPERFORMER TODAY DESPITE THE UPTICK IN US BOND YIELDS
Market is on the defensive EU, Usd/Jpy is at a standstill. Exporters want the BOJ to keep markets stale. Two year US Note looks enticing for the bid side into the selling. Believe risk on bias is still present enough in stock and Euro markets to warrant risk on positioning at this point but letting the minutia play out might be prudent. Noting put to call ratios in stock options have creeped in since Friday putting a little pressure on performance.
I have posted links to this article before and each time it attracts fresh attention. To show yoiu there is a method to my madness, look at the high on this XAUSUSD chart and read or reread this article.
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