Interest Rates are now Center Stage

With Powell’s FED comments today we see an approach where he is willing to do nothing until he sees the whites of the eyes. Those whites will not be of a strong economy, but more likely the whites of the eyes of the bond vigilantes.

See the 10 year interest rate chart here.

What if we see an overshoot, kind of an opposite of the undershoot we have just gone through. See expanding wedge in the chart. That would put the 10 year rate over 4.0 %, in the area of 4.15 %.

We are selling the stock market here, adding to our position late today.

There is real potential for a major fracture here, big moves, bonds down, gold down (maybe 1350), stocks down, dollar up.

Go with the flow when this takes off.

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