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.

US10YT Drops To A New Low

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I last wrote about US 10-Year Treasury Yields in my post of August 16, 2019, which warned of potential upcoming weakness in the equity market. It was trading at 1.556.

Since then, it rose to a high of 1.952 in December, reversed course sharply in January, and has plunged to an all-time new low of 1.254 as of 2:15 pm ET today (Thursday), as shown on the following Monthly chart, as equity markets reached a 10% correction level this morning.

The big question is, is this capitulation or is it a warning of further equity weakness?

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Dr. Copper Needs An Antidote

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The following weekly chart of COPPER shows that its price has fluctuated wildly around the 2.47 level in an increasingly narrowing triangle formation since the end of the 2008 global financial crisis. At the moment it’s acting as major support and happens to coincide with the triangle apex. A drop and hold below this level could see a sharp downdraft in this commodity to around 2.20 (price support combined with the bottom of the triangle and a secondary volume bump), or lower.

Major overhead resistance sits at the confluence of the 50 & 200-month moving averages with the Volume Profile POC around 2.70. A spike and hold above this level could see price rise to around 2.99 (price resistance combined with the top of the triangle and a secondary volume bump), or higher.

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U.S. Tech Sector Blow-Off Top In Progress

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Further to my post of February 10 regarding FNGU (an exchange-traded note that tracks 3x the daily price movements on an index of US-listed technology and consumer discretionary companies) and the Nasdaq Composite Index, the following scenario developed.

  • FNGU did retest its prior all-time high, blew past it, and made a new high at 115.40 last week, as shown on the weekly chart below.
  • The Nasdaq Composite Index did attempt to reach 10,000, but stopped short at its new all-time high of 9838.37 last week, as shown on the weekly chart below.
  • After they both formed a shooting star candle last week, they gapped down considerably today (Monday) to close near their low of the day.
  • You can see, from the last two chartgrids (daily timeframe), that all of the ten tech stocks which comprise FNGU gapped and closed down on Monday, as well.
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FNGU: Blow-Off Top Coming?

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I last wrote about FNGU in my post of December 26, 2019.

FNGU is an exchange-traded note that tracks 3x the daily price movements of an index of US-listed technology and consumer discretionary companies. The index is highly concentrated and equally weighted.

Since then, price blew through both the 78.6% Fibonacci level and it’s prior all-time high, as shown on the following weekly chart

The Balance of Power still lies in the hands of buyers, in spite of a bit of a blow-off in the last weekly candle. We may not see a trend reversal until this indicator spikes to, and closes on, a new high in one of the coming weeks.

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Money Flow Flip: SPX vs GOLD vs OIL

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Further to my post of January 9GOLD is poised to take the lead away from the SPX in terms of safe-haven money flow, while money has been fleeing OIL.

As shown on the following monthly comparison chart of the SPXGOLD and OIL, the Balance of Power has shifted from buyers to sellers in the SPX on this timeframe.

For clues as to further weakness or strengthening of the SPX, please refer to my comments with respect the SPX:VIX ratio in my last post, which hints of further weakness. Furthermore, January’s candle formation on the SPX is a shooting star, also a bearish signal in the longer term.

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