So yesterday market participants were instigated by the media to get hysterical about interest rates. I saw a prominent headline talking about how a market expert (whose name escapes me) forecast that when 10yr yields go through 3% stocks are going to go down big.
Then today, as risk flies ‘off’ ostensibly due to the Trump/China tariff war, yields tank, Treasury bonds rise and stocks go down anyway. Ha ha ha…
If you click the headline they will tell you all you need to know, and way more than you need to know as a rational and calm market participant.
Meanwhile, the Continuum had indicated that a caution point was at hand long ago.
I will not predict for casino patrons what is going to happen with the stock market in the short-term. But I will tell you that anyone still getting hysterical about long-term Treasury yields (Amigo #2) even a month ago was putting themselves off sides from a contrary standpoint and by the Continuum above, a long-term historical standpoint as well. Meanwhile, the last Amigos update back on March 8 showed a stable backdrop although some short-term indicators (per a recent NFTRH update) have the potential to go negative.
But it’s funny how rising yields were supposedly bad for stocks (per massive media eyeball harvest campaigns) but stock market volatility is happening at a time when yields have pulled back – on schedule – at least temporarily. So again, what was Amigo #2 bracing for?
Our theme has been that stocks (and the entire ‘inflation trade’) would rise with yields, not against them, at least up to the Contiumuum’s limiter. Caution comes at the limiter but the other Amigos need to fall in line to get a real bearish narrative going.
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