Yesterday we highlighted that our Weak Stock Market Close Indicator indicator had surged to the highest level since 2012 and today a client made the good point that our Weak Stock Market Close indicator seemed to give more false signals when the Fed was engaging in...
For about 15 days between the end of August and mid-September the action in the treasury bond market deviated from our model comparing bond yields to the change in the size of the Fed’s balance sheet....
We noted yesterday how treasury bond yields keep falling along with the reduction of fed purchases. This inspired us to dig deeper into our chart library to see how other asset classes or economic statistics have performed in relation to our taper model....
Despite today’s modest uptick in treasury bond yields, the downward trajectory in yields coinciding with the Fed’s tapering of asset purchases remains firmly intact. Admittedly we’ve been harping on this point now for months, so we’ll keep this post short and sweet....
Barely a week after 2Q GDP and a slue of revisions indicated that the economy has performed better initially indicated in the first half of 2014, bond yields are again making new 1-year lows....
The S&P Small Cap 600 has now underperformed the S&P 500 by over 10% since March. July was particularly brutal as small caps underperformed by nearly 6% in that month alone. This relative underperformance has been somewhat predictable given what the Fed has been up...
Last week we wrote that the bond market is following perfectly the reduction of QE with new 1-year lows and with today’s bond moves that trend is still firmly in place. In what may seem counter intuitive, treasury bond yields have had a high positive correlation...
The Fed is set to conclude its nearly six-year-old experiment with quantitative easing (QE) and the Federal Reserve Board has clearly laid out the most likely course for termination of the program....
One day does not make a trend, but we are surprised by the market’s reaction to the notably good payroll, personal spending, consumer confidence, and GDP data released recently. Specifically, we have stocks up 1.1%, the dollar unchanged, and bond yields anchored to 2.88 on...
Despite Fed minutes that left the door open to a December taper contingent on better economic stats, the markets are taking the relatively upbeat data over the last two days in stride....
The taper trade appears to be back on this week. Some of the basic symptoms of this trade are: 1) higher interest rates, 2) higher US dollar, 3) lower gold and 4) weakening stocks. Charts below showing the last 10 days of activity reveal this...
