The collision of global markets and social mood

Tuesday, April 11, 2017

Tuesday -- China's $9 Trillion Game, Kashkari, T-Bill Inversion, Crisis Levels

S&P E-mini Futures:
Down in continued choppy trade.

Asia mixed, Europe largely green with Germany and Italy red.

Commodities down, precious metals bid.

VIX up almost 2% pre-market (but fading).

Fed's Kashkari speaks today. Notable because he got into it with Jamie Dimon on Twitter after his last speech. Highly unusual.

Confidence. On both sides.

China Is Playing a $9 Trillion Game of Chicken With Savers

"Chinese savers have poured $9 trillion into WMPs and similar products on the assumption that they’ll get bailed out if the investments sour, even after news in February that policy makers are drafting rules to make it clear that state guarantees don’t exist."

Eerie calm once again. NZD, NOK & SEK weaker. CHF & JPY stronger.

Higher prices at the moment, but a long way to go (and a lot of volume needed).

T-Bill yield curve inversion signaling real concerns of a possible government shutdown.

WTI crude back above 53. NG back above 3. Probably the next move that counts for both.

Palladium sitting out the bid in metals thus far.

S&P Outlook:
Fed's Kashkari participates in a Q&A at 1:45 pm. He's been on a roll lately, getting into a twitstorm with Jamie Dimon, and also tweeting, "Stock market unlikely to trigger a crisis."

One thing is for sure: the stock market will trigger the next crisis. Find a news event that reversed the market's overall trend and let me know.

Not seeing "crisis" potential until after a clear five waves up can be counted from the February 2016 lows.

Until then, either the market goes higher, or it consolidates lower. Expectation is the 2300 area. Only below 2277.53 would warn that a crisis is lurking.

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