11:21
Unknown
Minor pullback or correction or a crash ?
These are the thesis many technicians & traders are grappling with......
Some technicians can"clearly see 1500"
Some traders are bracing for much much lower than that ?
What are the "rationale" for these numbers ?
OH .....10 yr bond yield is @ 2.828% from 1.55% a 55.59% jump in yield......
OR... TLT has crashed from 128.50 to 102.67......a 25.83 points drop or drop of 20.10%
IF these TUMBLING numbers in last 12 months are telling us so much........WHY have we :
-Continue to make series of new HIGHS in equities?
-While bonds are tanking we have gone from 1250 to 1709.67 a jump of 459 points or a jump of 36.72%...
- We can draw a chart which could be exactly REVERSE in the last 12 months......TLT vs S&P 500
- While the PANIC is setting in, we have corrected only 3.34% in S&P 500 from all time highs
NUMBERS speaks LOUDER than LOGIC ?
YES...we can all PANIC & sell everything...because we "see trouble ahead"
BUT...the question IS......what trouble?
IF Higher interest rate is going to KILL housing & SLOW US economy to a CRAWL....then why would Fed going to TINKER with Bond purchase.......LOGIC should tell us that FED should be giving MORE support by buying $100 Billion in MBS.........
BUT Wall Street is not that predictable or RATIONAL...TAPE always goes to one extreme or other.....so currently we are correcting MORE than what Fed may be TAPERING to.....my guess is Fed may Taper from $85 Billion to $70 billion & may monitor the impact on economy.......
Once Fed action is OBVIOUS then 10 yr can come down to 2.5%.......
The minute this "OBVIOUS" strategy is concluded upon......watch 10 yr yield come to 2.5%.......
Then the RALLY CONTINUES to series of new HIGHS again !!!!!
Please factor ongoing improvement in Europe & China which is starting a new BOOM in base & precious metals......
We MAY have COMPLETED this minor pullback with minor uptick in interest rates......
YES housing will be stable in a 2.5% yield or 4% in 30 year mortgage......
These are WORKABLE & DESIRABLE trend......
Do NOT fight healthy MIX......
BLOG does NOT give buy or sell.
Saleem
These are the thesis many technicians & traders are grappling with......
Some technicians can"clearly see 1500"
Some traders are bracing for much much lower than that ?
What are the "rationale" for these numbers ?
OH .....10 yr bond yield is @ 2.828% from 1.55% a 55.59% jump in yield......
OR... TLT has crashed from 128.50 to 102.67......a 25.83 points drop or drop of 20.10%
IF these TUMBLING numbers in last 12 months are telling us so much........WHY have we :
-Continue to make series of new HIGHS in equities?
-While bonds are tanking we have gone from 1250 to 1709.67 a jump of 459 points or a jump of 36.72%...
- We can draw a chart which could be exactly REVERSE in the last 12 months......TLT vs S&P 500
- While the PANIC is setting in, we have corrected only 3.34% in S&P 500 from all time highs
NUMBERS speaks LOUDER than LOGIC ?
YES...we can all PANIC & sell everything...because we "see trouble ahead"
BUT...the question IS......what trouble?
IF Higher interest rate is going to KILL housing & SLOW US economy to a CRAWL....then why would Fed going to TINKER with Bond purchase.......LOGIC should tell us that FED should be giving MORE support by buying $100 Billion in MBS.........
BUT Wall Street is not that predictable or RATIONAL...TAPE always goes to one extreme or other.....so currently we are correcting MORE than what Fed may be TAPERING to.....my guess is Fed may Taper from $85 Billion to $70 billion & may monitor the impact on economy.......
Once Fed action is OBVIOUS then 10 yr can come down to 2.5%.......
The minute this "OBVIOUS" strategy is concluded upon......watch 10 yr yield come to 2.5%.......
Then the RALLY CONTINUES to series of new HIGHS again !!!!!
Please factor ongoing improvement in Europe & China which is starting a new BOOM in base & precious metals......
We MAY have COMPLETED this minor pullback with minor uptick in interest rates......
YES housing will be stable in a 2.5% yield or 4% in 30 year mortgage......
These are WORKABLE & DESIRABLE trend......
Do NOT fight healthy MIX......
BLOG does NOT give buy or sell.
Saleem
Posted in: Mixed
0 comments:
Post a Comment