Generally speaking, the reflationary crap is getting bid and safe havens, Covid stocks and Tech leaders are halting or pulling back. In other words, risk is impulsing ‘on’ today in a reflationary direction. We’ll see how well that works beyond a day.
It’s as if the machines and the hedge funds, momos and Mom & Pop that follow them cannot take it anymore as the dollar remains weak, yields finally get a little bounce and indicators like copper and the TSX-V push the limits.
I mean, where were you guys in March? April? May?
As noted in the above-linked post this could well be the gateway to the inflationary future, but I just don’t love the setup because there have been breakdowns in Energy and other reflation-sensitive sectors and Treasury yields are far from bullish still (bonds are far from bearish). I don’t love that with copper and da ‘V’ so extended some broken crap is bouncing.
But then again, I’ve seen stranger things than a real reflation trade confirming out of this. So, open mind and all, forward we go.
Meanwhile, here is another inflation/reflation indicator (along w/ copper and TSX-V). The Silver/Gold ratio is still rallying but so too is it still in lock down, trend-wise.
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