The collision of global markets and social mood

Thursday, April 6, 2017

Thursday -- "Too Soon" For Draghi, Museum-Quality Social Mood

S&P E-mini Futures:
Shallow bounce from yesterday afternoon's sell off.

Mostly red in Asia, but China green ahead of President Xi's sleepover at Mar-a-Lago. Europe mixed.

WSJ -- ECB’s Mario Draghi: It’s too soon to reduce stimulus

At what point in the mood (& credit) cycle would you expect to find a museum-quality exercise bike?
As the bull market need for bigger, better, faster intensifies, so do the "tools" to keep up with it.

Described as "a piece that would look more comfortable in a museum than it would in a gym," maybe that's right -- that way future generations can study how peak social mood manifested itself in the most unexpected ways.

Bitcoin up over 3%

Very quiet after yesterday's jolt to equities.

Day Three of stall speed when follow through should be strong.

Overheard yesterday: "if bonds want higher price the market's heading south" even though one of the biggest trends ever has been the uptrend in treasury prices (lower yields) coinciding with the uptrend in stock prices since 1981 and 1982 respectively.

Source: St Louis Fred data

Both WTI crude and NG up together for a change.

Gold and silver green with platinum and palladium red. Copper bouncing around red & green.

S&P Outlook:
Got the rally into the S&P 2376-2380 area as expected but then a hard sell off. While the sell off seemed to flip out many investors and pundits it did not break any swing points, so technically nothing was "broken."

Any follow through could easily break the up trend, but quite a bit would be needed.

Watching S&P 2344.73 and NDX 5316.02 as tells. A break of 2344.73 could open up 2300 and 2275. Otherwise, prices can still wedge higher if they want.

Got some May VIX 13 calls and tweeted about waiting for better buys on NQ, ES, SPX, SPY, and OEX puts (whichever looked priced best) but missed them due to my rule of not going counter-trend on Wednesdays.

This rule is only about a year or so old, but has already saved me a ton of dough so I don't like to go against it. But must admit yesterday's reversal was painful to see without following through on my instincts.


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