Buy the Hope, Sell the Fact

What we are talking about is getting back to Normal. We are now in our second Wave of trying to get back to normal and the touters are shouting that this is the Great Reflation.

The problem is, things can get too pricey in the second and third rounds of Hope. I would say the market action this week may be the start of an underground deleveraging rather than a formal rotation.

May have more comments later this day, time for coffee at the moment. The comments in the Sunday Special blog kind of outline what we are awaiting here.

At the moment here is a little sidelight, the Chair chart formation in the hourly S&P futures last night around midnight. Are they sitting on the edge? Looks like they are trying to stand up this morning. This is the kind of chair you sometimes see in a High Wire Act.

9:43 AM Update here on a couple of our charts:

This chart is really getting interesting, the August 7 Apex stands out there, the main thing that has happened since is that bonds and gold have gone down and stocks have gone up. I am still waiting on the stocks down phase, maybe today or next Wednesday, or any day in-between.

The second chart is our basically long dollar chart with a couple of kickers, short gold and stocks, and long bonds as insurance. The index of this trade was set at 1.00, today it is around 1.037, (DXY at 93.16, TLT at 155.23, XAU at 1865, SPX at 3564, NDX at 11828). You might note that the historical 200 day average on our index comes in at 1.673 and resistance is at 2.320.