Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

ISM Manufacturing is Wobbling @ 49.4%

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The weak ISM headline number (PMI) was an excuse for bonds and precious metals to bounce and the US dollar to drop today. It evidently inspired wild eyed casino patrons to unwind recent positions (short gold, long USD for instance) as the great and powerful Fed now has reason to stand down in September. Such is life in the casino; always a story, always a play, always manic, always addicted to short-term news and media inputs.

Before looking at the particulars of ISM, let’s review the Machine Tools sales data that we have not looked at in a while. It is and has been W.E.A.K. for years now, outside of the traditional year end tax mitigation bounce. Data through June (source: EDA):

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All News is Good News

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Well, I guess we needn’t fret about my “dream a little dream” charts. The jobs report came out, and the market is higher. See, because if jobs were strong, that would mean the economy was strong, thus higher equities. But since jobs came in really weak, that means – – ummm – – well, I’m not sure what it means, but it also means higher equities. The logic is inescapable.

In any event, the daly ES is still fairly inscrutable, since we’ve been “drifting” for months now:

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Dream a Little Dream

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Friday morning provides us the monthly jobs report, and of course there is no telling what it’ll say or, more importantly, how the market will react (or, even MORE importantly, how the market will react by the end of the day………..since these days early morning activity appears to have almost no sway over where things finally wind up).

If I may indulge in the absurd fantasy that we’ll actually get a break lower in the market, I wanted to provide some key support levels which, if breached, which signify that the endless nightmare for the ursine set may well be at an end. Here are the indexes in question:

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Dow Composite Channel

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It may surprise you to know that the Dow Jone Composites peaked about six weeks ago, particularly since lifetime highs on other major indexes were the norm until a few days ago. This is a crucial junction, since we’ve traveled back to the channel which used to be its confinement until it broke out early in July. A big drop Friday (unemployment report day) would finally turn things clearly bearish.

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