That Familiar Feeling
We’ve been here so many times, Yogi would say it’s like deja vu all over again.
Earlier this week the market had nothing going in its favor and you could feel the complacency turning to caution.
Bullish sentiment from Investment advisors hit an almost unheard of 20% and that alone should have signaled the market would do what it always does when a few market averages break the 50 day moving average and threaten the lower band of an upward sloping channel.
Of course!! We held support and staged a 1%+ rally!! It’s become so predictable, it was almost boring to watch!!
Thursday’s market had all the makings of an impressive follow through day until……”please, not Greece again!”…..yes, until the drama in Greece demanded more market attention. Specifically, the IMF, fresh off its newly self appointed role of “Consigliere to Central Banks everywhere” proclaimed “No Mas!!” and told us what we’ve all known for months…….the negotiations with the Tsipras and Varoufakis are going nowhere without debt forgiveness and a free pass at unfettered fiscal recklessness.
Thankfully, the market seems to have mostly over on from Greece as a front page issue, and the sooner the players involved accept the inevitable, the better off we’ll all be.
Getting back to things that really matter, the the US bond market had its sharpest rally in 3 months after the 10 year note briefly hit 2.50% in very early trading. This was of course before the release of the May retail sales report at 8:30. That report showed a welcome lift from the anemic levels of retail sales the first 4 months of the year, but was not nearly “hot” enough to spark fresh concern that the FED might raise rates this weekend.
Yes, Goldilocks is alive and well in the land of US economic data!!
Where does that leave us??
Basically the same place we’ve been at least a dozen times in the last 10 weeks.
Slightly better than half way between support and resistance in the middle of a still upward sloping channel, looking for that elusive game breaker to jolt us out of the mid year monotony.
Stay tuned, It might be a while.
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