With the big bounce back in long-term Treasury bonds (as yields got slammed right where the Continuum’s limiters projected they would) we have Amigo #2 in the books. Remember that Amigo was only projected to halt and reverse hard at the limiters (catch the media-following herd completely off guard), not necessarily to begin a new bull phase in bonds. So he’s in the books and we of now know what he was bracing for (we knew all along; but needed yields to follow through to plan).
Amigo #1 is the stocks vs. gold Amigo and last week he had his eyes closed presumably to get ready for a hard impact of his own. However, we had noted that the SPX/Gold ratio was not broken down in-month and now with the stock market bounce back let’s take a daily view of the situation.
SPY/GLD has bounced back to what could be considered the hard break point that put the ratio in jeopardy last week. So here we are with a macro signal on a grind that will either join its Compadre, Amigo #2 and break down with a macro warning or recover the trend currently in place, which is up and happy-go-lucky for the macro. Just giving you and up to the minute geeky view of the market.
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