Slope of Hope Blog Posts
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Sooooooooo……….I guess the Nobel Prize is going to wait, eh?
Anyway, it’s nice to wake up to a morning with so much red on the screen. The one huge exception is bonds, which are up over half a percent. I’m not worried, though. It’s all following a pattern. You can see the “big tops” (with little exploration zones, in grey) followed by a “V” shaped drop and retest. That’s all we are doing right now. We are in retest mode. I’m going to increase my January 2019 TLT puts this morning.
Today was a pretty interesting one. One bit of bleakness, in spite of the dip on the Dow, was that we’ve got a set of higher highs and higher lows, as I’ve illustrated below with the arrows. I’m hoping this is a one-hit wonder and not a trend change, but – – – them’s the facts.
I can hardly remember the last time I woke up to a red NQ, red ES, and red ZB (bonds). I think it was about thirteen or fourteen years ago. But it’s a delight to hold, and of course I’m grateful to the obvious impetus behind this move.
In particular, the weakness in bonds is key (as you well know by now). Here’s the close-up view, and as I’m typing this, bonds are down about six-tenths of a percent.
It’s the happy-go-lucky 3 Amigos (in play since we began this goofy metaphor last fall), which would signal macro changes to come. When you are talking about the macro however, things move slowly and to date, only one of our riders has made it to his destination.
To review, they are Amigos 1-3, Chevy, Steve, and Martin.
- Stocks vs. Gold
- 10yr & 30yr Yields
- The 10yr-2yr Yield Curve
Below we’ll review a daily (short-term) and monthly (long-term) chart of each to check the status.
Amigo #1: Stocks vs. Gold
We noted Amigo #1’s eyes closed as stocks vs. gold took a big plunge in early February and again in March. This has actually set a lower highs, lower lows downtrend in 2018, and the swings have been very dynamic. Right now we are on an up swing and if you are a gold bug and this ratio rises above the March high please prepare to take caution, as the macro would be moving against you, at least relative to risk ‘on’ assets. But for now the lower highs and lower lows daily trend is intact. (more…)
Good morning, Slopers, and greetings from oh-so-dark Palo Alto. My dogs gaze at me longingly for their walk, so I’ll just send this out and get the day rolling.
Before I begin, let me say a few of you prefer to jump right into the blog posts (a la the old Slope), so I have a suggestion: bookmark this URL as your Slope page: https://slopeofhope.com/page/slope-blog.html – and that’ll take you right to the blog with the most recent at top.
Looking at the ES, it’s interesting that over a period of five months, we have gone…………….nowhere. Sure, there’s been volatility (albeit ever-diminishing) and about a 350 point range, but just look at that arrow. With all the mayhem that’s been going on, the S&P was a little under 2700 in mid-December and it’s a little under 2700 right now. It’s getting dull again!
Good evening, everyone……….
Me and my fellas are hard at work (it’s been continuous since Friday) working on optimization, uptime, and reliability. I have probably accrued a dozen posts to write about the insanity we’ve been going through. It reminds me the old days at Prophet. You might as well put me in a trench with grenades going off around me, because that’s what it feels like, but I sure am glad to have my colleagues at my side. And we are making some GREAT strides this evening.
Out of the corner of one eye I’m watching the night time markets, and of profound interest to me is bonds, whose failed bullish breakout is mesmerizing. It’s not like there’s a dramatic plunge – about one third of a percent as I’m typing this – but an ultimate break of 141’13 on that horizontal would be spectacular to behold.