The Hysteria Twins…
Jamie Dimon and Jim Bullard, the JP Morgan / Fed Gov, doomsayers got a bit over their heads since January 9th, with their negative talk. All the hysteria over the January PPI numbers, which were a little higher than expected, probably due to short term energy issues, has induced FED Governor Bullard to try and save the day for all the short-sellers.
In reality, oil prices topped out in March 2022, almost a year ago, and the CRB commodity index topped out 8 months ago in June 2022. Year on year numbers are about to start tumbling. This stall in energy prices and energy stocks is the reason the S&P has been lackluster compared to the Nasdaq and Russell 2000 stocks.
Last night this hysteria all played out in market interest rates that moved up towards the October highs of 4.465 % with a 4.190 trade at 2:00 this morning.
That has set up a compression trade basis our S&P model that has the potential to push the S&P up and out of its recent resistance zone and stage a breakout of sorts to the 4333 level.
It should be an interesting day.