Stocks and Gold; the Next Opportunity

By NFTRH

Unless you visit the Notes From the Rabbit Hole website regularly, you might think the title of this article implies it is written by a market analyst pretending to know what will happen; like a top in the stock market or a resumed bull cycle in gold.  You might also think it is written by one of the writers who’ve either a) been fighting the stock bull since the bearish market terminated a year ago or b) been a perma gold bug bull.

So once again, we have our disclaimers because in a milieu of quickly forgotten soundbites, integrity is important.  So I point you to a couple of posts (among many others) that indicated, when the time was right for people to get bullish the stock market in favor of gold.

AMAT Chirps, B2B Ramps, Yellen Hawks and Gold’s Fundamentals Erode (May 30, 2016)

Detailed Multi-Market Update (an NFTRH premium update, now public, from July 22, 2016)

From the July 22 NFTRH update, in the event you don’t wish to follow the link to read the whole thing…

Yesterday in a public post a target was established for the S&P 500.  I’d love to see a drop toward 2100 to clear over bullishness but regardless, SPX targets 2410 as long as it’s at or above the noted support zone.

Here is the price panel of the chart from that update…

spx

Indeed, SPX went on to make a hard test of 2100 on election jitters, as you can see by today’s version of the very same chart.  That folks, was the last opportunity for those who had remained bearish after Brexit, to stop being so.

Continue reading Stocks and Gold; the Next Opportunity

Stocks Trying to Break Out Relative to Bonds

By Chris Ciovacco

Energy Stocks Above Prior Resistance

When investors are more confident about economic and market outcomes, they typically prefer to own growth-oriented sectors, such as energy, over more defensive-oriented bonds. The chart of energy stocks (XLE) relative to long-term Treasury bonds (TLT) is trying to hold above an important point of prior resistance. The longer XLE can hold the breakout relative to TLT, the more meaningful it becomes.

Deterioration In Numerous Asset Classes

Many interest rate sensitive assets, including gold, bonds, and REITS, sold off last week. This week’s video looks at the deterioration in the context of risk management. Updated longer-term charts are also covered for the S&P 500 and broad NYSE Composite Index.

After you click play, use the button in the lower-right corner of the video player to view in full-screen mode. Hit Esc to exit full-screen mode.Video

Video

Stocks vs. Bonds

The chart of stocks (SPY) relative to bonds (TLT) is sending similar messages to those seen in the energy/bonds ratio. The SPY/TLT ratio was rejected at the thick blue trendline three times in 2015 (see orange arrows) and again in September 2016. The longer SPY can hold the breakout relative to TLT, the more meaningful it becomes.

Tech Trying To Clear A Long-Term Box

The chart below shows the performance of technology stocks relative to intermediate Treasury bonds (IEF). The ratio entered the long-term orange consolidation box in December 2013 (almost three years ago). The ratio was near the lower end of the box as recently as June 2016. The breakout sends signals about the economy and interest rate expectations.

Rate Hike Odds

On October 4 following some strong economic data, asset class behavior started to signal two things: (1) the odds for a Fed rate hike in December were increasing, and (2) the economy and markets might be able to withstand the hike this time. Obviously, with quite a bit of time between now and the Fed’s December meeting, 1 and 2 above fall into the TBD category.

Similar Messages From High Beta

The High Beta ETF (SPHB) has higher weightings in materials (XLB), energy (XLE), and financials (XLF) relative to the S&P 500’s weightings (SPY). As shown in the chart below, this economically-sensitive investment is trying to hold the recent break above an area that has acted as resistance for a year. As recently as June 28 (point A below), SPHB looked to be on the ropes. Since then, SPHB has made a higher low (point B) and a higher high above point C.

The longer SPHB can hold above point C, the more meaningful it becomes.

MSM Hits New Highs… in Stupidity: WTI Golden Cross

By Biiwii

We have shown again and again how when a “Golden Cross” (or Death Cross for that matter) is touted – especially in the greater media – that it is at best a non-factor and at worst a sign that everybody’s got the memo and the market in question will soon take a turn for the worse.

On cue, not only does MarketWatch chime in with some Golden Cross hype this morning but it leverages the idiocy to call crude oil’s Golden Cross a good thing for stocks this summer.  Bulls take note!

If this happens, it could be a fantastic summer to own stocks

Not good, not sensible… Fan effing tastistic!

wtic

MSM, always on watch to make up stories to justify market moves or simply inspire peoples’ imaginations hallucinations.

Stocks at Risk?

By Biiwii

This is as much a test post for the new site as it is a market commentary.  Biiwii.com is going to be primarily a guest site (nftrh.com will be my main posting venue for public as well as premium content) featuring the usual cast (Ashton, Hoye, Saville and others I think have quality, typo free financial market content) plus other quality writers I may find along the way.

Anyway, let’s see how a chart of the VIX looks with the current site format.  I know how it looks for stock market players; it looks like they have unwound all of their apprehension from earlier in the year.

vix