Hey Nerds: Blockchain
- Thread starter zeke
- Start date
LeafOfFaith
Well-known member
CH1
The Artist Formerly Known as chiggins.
If you look at the nerdies it was very bearish
CH1
The Artist Formerly Known as chiggins.
zeke
Well-known member
On Jul 26, DJIA went up 35500 for the first time in almost 3yrs. on the same day, jul 26, Fed hiked rates again, and threatened more going forward. On August 1, Fitch downgraded US longterm credit ratings due to "political dysfunction". On August 7, DJIA was just a tick under 35500 still. On that same day, Aug 7, Moody's downgraded and threatened to downgrade the ratings of most regional banks in the country for even murkier, more nonsensical reasons.
And despite all economic indicators looking very good, the market then crashed.
And despite all economic indicators looking very good, the market then crashed.
CH1
The Artist Formerly Known as chiggins.
Moody’s (the other rating agency) downgraded US credit rating just last Friday. The market shrugged.
There are so many economic indicators out there (most of them backward looking) that most of the time you can make a strong case for either bulls or bears.
The market usually turns when there are too many bulls or bears and sentiment gets stretched too far in either direction. Meaning that it doesn’t matter how great the news is, if everyone out there is already in the market, there’s nobody else to buy (so market goes down)
Recent action has been the reverse - lots of bearish bets (put volume has been relentless for months) so today’s pop can be partly explained by bears throwing in the towel.
The market has it’s own dynamics, often not especially aligned with the overall economy
There are so many economic indicators out there (most of them backward looking) that most of the time you can make a strong case for either bulls or bears.
The market usually turns when there are too many bulls or bears and sentiment gets stretched too far in either direction. Meaning that it doesn’t matter how great the news is, if everyone out there is already in the market, there’s nobody else to buy (so market goes down)
Recent action has been the reverse - lots of bearish bets (put volume has been relentless for months) so today’s pop can be partly explained by bears throwing in the towel.
The market has it’s own dynamics, often not especially aligned with the overall economy
CH1
The Artist Formerly Known as chiggins.
Honestly nobody gave a shit. I was watching because I had some SPY puts - it initially went down about a buck Friday after the close… but went back up yesterday. That indifference was my cue to get out —I escaped today’s carnage but kicking myself for not taking a stab long before inflation numbers came out.
10 baggers galore this morning!!
lecoqsportif
Well-known member
I think they stand pat, today’s inflation report is going in the right direction - particularly the slowing of shelter cost increases.
Moreover, there might be some concern about the recent increase mortgage-treasury rate spread. It is quite high, and imagine the Fed would like to see the spread return to a normal range… mortgage rates would have to drop by 100 points or so (but they would need the yield curve to un-invert itself.)
If they increase the policy despite a decent inflation report, they’ll really spook the lenders.
Moreover, there might be some concern about the recent increase mortgage-treasury rate spread. It is quite high, and imagine the Fed would like to see the spread return to a normal range… mortgage rates would have to drop by 100 points or so (but they would need the yield curve to un-invert itself.)
If they increase the policy despite a decent inflation report, they’ll really spook the lenders.
CH1
The Artist Formerly Known as chiggins.
Market pricing in 4 rate cuts in 24.
lecoqsportif
Well-known member
There’s the un-invert.