Chinese Manufacturing PMI came in Saturday with a miss at 49.8 – again signalling that the world’s “economic power house” is now in contraction, so I wouldn’t be expecting a big “up day” tomorrow morning.
One needs to “completely ignore” the current slew of media headlines as every Central Bank / manipulated media outlet on the planet is on “full alert” to do whatever they possibly can to assure the general investment community that “all is well – there is nothing to worry about at all”. Right.
European stocks have had their “booster shot” due to the QE announcement from The ECB, but have now been rejected at the previous highs.
As totally frustrating as the last few weeks ( if not months ) of trading has been, we’ve now seen the injection of another “trillion” in proposed asset purchases and still…..even still – markets can’t move any higher. Tops are long, tops are drawn out, tops are a pain in the ass but……now with The ECB “done” – seriously…….what’s left from the CB’s to push this thing any higher? Zip.
EUR / USD finally showing solid signs of bottoming / finding a low.
Interesting to note The CRB Commodities Index, as one could entertain the scenario that money comes out of ridiculously bloated / bullshit pumped up stocks, and flows into commodities.
The U.S Dollar rampage should conclude here pronto – as it’s exhausted to say the least. Two “doji candles in a row” signalling obvious “indecision” and with commodities looking to bottom out we understand the correlation. A weaker US Dollar ( finally ) = rising commodity costs.
The SP 500 along side “risk in general” has been weak for some time now…but still hasn’t “kicked off” on any kind of lasting downtrend. The whipsaws / sideways trading has been a pain, but all with conclude here shortly.
Even if The SP “does” get a bounce to around 2040 area…it doesn’t make a hair of difference medium term. The next leg down will bring tears to your eyes, fear to your wife and a fat hole in your account should you decide to stay the course.
The Canadian TSX as well as virtually all equities indexes globally are about to take the pain as The Nikkei ( suggested to reverse a few days ago ) has also hit overhead resistance and now looks to dump.
Currency wise little has changed really – as the general theme of long JPY vs the commodity currencies as well short USD vs E.U currencies still stands.