Today is one where after the large gains in the portfolio this week, the trader in me wants to take profits….but then when I look at the situation three things stand out.
- First my informal monitoring of Twitter tweets on the market, we still see a huge bias to tweets that dis this rally that has come since June 16, all the reasons why the market has it wrong, while the few that are on the long side are relatively quiet and tentative.
- Secondly the chart of the 2 year vs 3 month interest rates updated through 10:15 AM CDT today show that the chart has taken out yesterday’s highs. a good start, but taking out Friday’s highs on a closing basis will be needed to confirm a change in market sentiment on hikes above 3.0 % on the Fed Funds rate.
- And then we have the 4231 S&P close that would confirm a bottom in the S&P, we have traded above that level interday, but have sold off to below it on a trading sell-off.
Here is that yield curve chart mentioned: