NFTRH+; strategy meeting

A brief meeting it is, but I want to tell you that I am gaining interest in the USD A-B-C downward correction theory discussed in NFTRH 752 using this chart.

With commodities firm or at least bouncing and with Copper possibly breaking its consolidation handle upward (yet interestingly still in breakdown mode vs. gold) I crept the inflation trades a bit further today with a Nickel prospect (TLO.TO) and an Rare Earths producer (MP).

But beyond that, I am opening up to the idea that the broad market rally just might have more legs to it, with commodities possibly playing catch up as speculated might be the case in one of the audios I did this week (can’t remember whether it was with Jordan or just me discussing the markets, or maybe in NFTRH 752). Anyway, I know I mentioned it somewhere and want to again do so here.

What rhymes with a drop to a dramatic ‘C’ leg in USD (not yet activated by a loss of the neckline, by the way)? An improbable broad US and global rally that just maybe could make the SPX 4700 fantasy a reality before the bear resumes. Remember also that USD is in a firm bull market from 2008 and still would be with a drop to theoretical ‘C’ above. Talk about killing all the bears before the next bear leg?

Please take the above FWIW, as I am trying to figure out a complex situation and set of options just like the next schlub. But I want to guard against becoming perma anything. In my case that would mean waiting for the anticipated deflationary episode, and it could involve rising long-term Treasury yields as well. In which case only cash and maybe short-term bonds would work.

On that note, a steepening yield curve could initially be inflationary just as the inflationary steepener in 2020 was initially deflationary. Okay, I am thinking faster than I can write. But consider this some food for thought that we may expand upon if it continues to look possible, let alone probable.

Side note: the TSX-V index is supporting this view as its bounce continues, implying that the speculative inflation stuff is getting bid currently. If the above plays out, it would still be considered interim, but would appear quite tradable.


This Post Has One Comment

  1. Bart

    Actually my melt up comment was meant for here. I find it a fascinating suggestion.

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