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June 12, 2021 | Trading Desk Notes For June 12, 2021

A Powerful Key Turn Date at the end of March No market exists in splendid isolation. When any market moves, it impacts other markets – to some degree. When several markets reverse direction simultaneously, I call that a Key Turn Date (KTD) and see that as a powerful market signal. The power of the “signal” increases with the […]

June 5, 2021 | Trading Desk Notes For June 5, 2021

Markets were anticipating a robust US May employment report – but they didn’t get it The major stock indices had a huge rally from March 2020 to May 2021 (the S+P rose ~90%), but the indices seemed to lose their upside momentum and drifted sideways for the last six weeks. Given that a big part […]

May 29, 2021 | Trading Desk Notes For May 29, 2021

Chinese RMB hits 3-year high Vs. the USD The Chinese RMB rose nearly 4% against the US Dollar in the last two months – closing this week at a 3-year high. Some analysts believe the rally in the RMB was “engineered” by the Chinese government ahead of trade talks with the USA; however, the USD […]

May 22, 2021 | Trading Desk Notes For May 22, 2021

Speculative excesses are starting to crack My base case is that speculative excesses have driven many markets too high, too fast. Some markets that attracted massive speculative money flows have started to crack – perhaps an early warning sign for other markets that remain near their highs. I expect these initial “cracks” in speculative excess […]

May 15, 2021 | Trading Desk Notes For May 15, 2021

The DJIA fell ~1,500 points from Monday to Wednesday but bounced back ~900 points by Friday. In other news… The Dow Jones and S+P futures closed at All-Time Highs Friday, May 7, traded higher during the Sunday overnight session but turned lower Monday morning and tumbled ~1,500 points to Wednesday’s lows. The DJIA rallied back […]

May 8, 2021 | Trading Desk Notes For May 8, 2021

Stocks, commodities and gold surge higher, the US Dollar falls The S+P 500, the Dow Jones Industrials and Transports, and the TSE Index closed the week at All-Time Highs. The Transports (up ~145% since March 2020 lows) have closed higher for 14 consecutive weeks – for the first time in their 137 year history. Capital […]

May 1, 2021 | Trading Desk Notes For May 1, 2021

Possible major inflection point: stocks and commodities peaking, US Dollar turning higher at the end of April The S+P 500 stock index hit All-Time Highs in February 2020 but tumbled ~35% within the next five weeks as the virus contagion shattered investor confidence. Central banks and governments launched unprecedented monetary and fiscal stimulus to counteract […]

April 24, 2021 | Trading Desk Notes For April 24, 2021

Equities: choppy near All-Time Highs, US Dollar: weaker, commodities: smoking hot! The S+P 500 index chopped up and down within a narrow range this week after surging ~9% the previous four weeks. Implied volatility was also choppy day-to-day, but it was close to one-year lows at the end of the week – a sign of […]

April 17, 2021 | Trading Desk Notes For April 17, 2021

Stock indices: Soar to new All-Time Highs, again. The DJIA rallied ~16,000 points (~90%) in thirteen months from the panic lows last March to today. There were two parts to the rally – the first 50% was driven by massive Central Bank stimulus even as the virus battered the real economy. The second 50%, beginning […]

April 10, 2021 | Trading Desk Notes For April 10, 2021

Major stock indices at New All-Time Highs The DJIA and the S+P 500 closed at new All-Time Highs again this week, up ~10.5% from their March lows. This is the 8th time this year that these indices have closed the week at new All-Time Highs. Earnings season starts next week. The indices have been boosted […]

April 3, 2021 | Trading Desk Notes For April 3, 2021

For the 7th time this year, the S+P 500 Index closed the week at new All-Time Highs. The vaccine-driven re-opening surge remains the primary market narrative with solid support from 1) another massive government spending proposal, 2) massive capital flows ($320 Billion into equity ETFs since the election,) 3) huge job creation in the USA (1.6 […]

March 27, 2021 | Trading Desk Notes For March 27, 2021

As Good As It Gets? The S+P 500 share index had its best 12-month advance EVER from March 2020 to February 2021 on the back of the largest EVER liquidity injections from global central banks. The major stock market indices made marginally higher highs in mid-March and then turned lower. In last week’s TD Notes, […]

March 20, 2021 | Trading Desk Notes for March 20, 2021

Peak Stimulus? Buy the rumour – sell the stimulus checks? Stocks and commodities lurched higher, and the USD tumbled when Powell made it clear that the Fed would remain ultra-dovish; 24 hours later, stocks and commodities were lower, the USD was higher. This may have been a MAJOR TURN week. Was that As Good As It […]

March 13, 2021 | Trading Desk Notes For March 13, 2021

DJIA soars 2,200+ points from last week’s low to New All-Time Highs even as bond yields surge higher The US Treasury auctioned $255 Billion (!) of debt this week (including $38B 10-year bonds and $24B 30-year bonds), and the credit markets barely flinched – until Thursday night/Friday morning when 10-year yields surged to a 14 […]

March 6, 2021 | Trading Desk Notes For March 6, 2021

Speculative excesses peaked in February and markets have been in a correction phase. Time for a bounce? The stock market rally from the March 2020 panic lows paused in September/October but then resumed with a vengeance following the November election and the Pfizer vaccine announcement.   Tech was the initial go-to favorite, especially BIG CAP […]

February 27, 2021 | Trading Desk Notes For February 27, 2021

Interest rates surge higher: speculative bubbles pop. US Treasury 10-year bond yields hit a record low ~0.52% early last August (as gold hit a record high) and then trended higher for several months. This year, the trend accelerated and then surged higher, with the 10-year yield briefly touching 1.61% on Thursday following a dismal 7-year […]

February 20, 2021 | Trading Desk Notes For February 20, 2021

Interest Rates Are Sharply Higher On Reflation/Inflation Concerns Copper is at a 10-year high and has doubled in the last 11 months. Half of those gains came since the November 3rd elections. Freeport-McMoRan is up ~600% from last year’s lows. WTI crude oil has jumped over 80% since the November elections. Lumber has quadrupled from last year’s lows, […]

February 13, 2021 | Trading Desk Notes For February 13, 2021

North American Stock Indices Keep Rocking The major North American stock indices hit new All Time Highs again this week even as Old School valuation metrics continued to flash warning signs. It’s hard to know if buyers were motivated by optimism over vaccine programs, the coming re-opening boom, the wonders of centrally planned fiscal stimulus […]

February 6, 2021 | Trading Desk Notes For February 6, 2021

Old School valuation metrics don’t matter these days, we’re trading mass psychology In 3 of the last 5 weeks the DJIA futures have had more than a 1,000 point high/low range. Last Friday the index closed at a 6 week low, opened down Sunday afternoon and then rallied ~1,600 points to this Friday’s high. Old […]

January 30, 2021 | Trading Desk Notes For January 30, 2021

Did somebody ring a bell? An earthquake rumbled through the financial markets this week and sharpened everybody’s sense of risk. There’s been a growing concern about excessive speculation for the past few months but that was in anticipation of markets crashing – not ripping to the upside!   Good for you if you were on […]

January 23, 2021 | Trading Desk Notes For January 23, 2021

Major US stock indices hit new highs on inauguration The major American stock indices hit All Time Highs this week when Joe Biden was inaugurated as the 46th POTUS. Since the Nov 1st Key Turn Date, just before the election, the DJIA and S+P have gained ~19%, the Nasdaq 100 ~23%, the Russell 2000 ~40%, while the […]

January 16, 2021 | Trading Desk Notes For January 16, 2021

The pro-risk trade is very extended / at risk of a correction My core trading idea for the past month or so has been that the pro-risk trade (long stocks, long commodities, short US Dollar) is very extended and is at risk of a correction. I have been watching for opportunities to fade pro-risk market […]

January 9, 2021 | Trading Desk Notes For January 9, 2021

“In the short run the market is a voting machine, but in the long run it is a weighing machine.” Benjamin Graham   Across the spectrum of traders and investors there would be a wide dispersion of definitions for “short run” and “long run” but for the purposes of my personal trading “short run” means a […]

January 2, 2021 | Trading Desk Notes For January 2, 2021

Why do you believe what you believe? If you choose the trading life, you will have to deal with these existential questions, “Who do you chose to believe, why do you believe what you believe, how much of that is already priced in and what are you going to do when you’re wrong?”   In […]

December 19, 2020 | Trading Desk Notes For December 18, 2020

The Major American stock indices hit new All-Time Highs again this week with quad-witching and the inclusion of Tesla in the S+P 500 index on Friday. The DJIA is up >4,000 points (15%) since the Oct 30 Key Turn Date (circled on today’s charts) when a number of different markets all reversed “on a dime” as market […]

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