Inflation Storm Coming

Crude oil would likely be among the more hesitant movers today, still consolidating.

Bitcoin has shown rare daily strength yesterday – one that wasn‘t reflected universally in the crypto space. However impressive daily run, residual doubts remain, and Ethereum is still range bound.

Let‘s move right into the charts (all courtesy of www.stockcharts.com).

S&P 500 and Nasdaq Outlook

S&P 500 and Nasdaq 100

S&P 500 again didn‘t move much, and neither did Nasdaq. Both calm and nervousness before today‘s CPI, likely to be resolved higher.

Credit Markets

HYG, LQD and TLT

High yield corporate bonds‘ yet another black candle looks ominously – but only for the short term. Quality debt instruments rising is a sign of rush to safety and uncertainty ahead of CPI. As said yesterday too, it‘s though still a bullish sign that HYG rose.

Technology and Value

tech, NYFANG and value

Technology including NYFANG again had a relatively good day, and the unease shown by its black candle is to be seen foremost in value.

Inflation Expectations

inflation expectations

They‘re moving lower, but the TIP:TLT ratio isn‘t to be trusted even as the lull in yields remains on through the summer.

Gold, Silver, and Miners

gold, HUI and copper to 10-year Treasuries yield

The above is a picture of momentary stress to be reversed like a springboard, exactly in line with either of these two tweets before that happened: first on inflationsecond on transitory vs. permanently elevated.

CrBitcoin and Ethereum

Bitcoin and Ethereum

Crude oil bulls had to defend against meek premarket selling yesterday. The crypto bulls aren‘t out of the woods yet, but it‘s not unreasonable to expect the biting inflation to improve their stance.

Summary

S&P 500 remains well-positioned for further gains, and it paid off to wait through the premarket tremors in Nasdaq too.

Gold and silver are well-positioned to withstand the pressures, and the miners to invalidate their recent weakness.

Crude oil would likely hitch a ride in a tight range on the bullish side, without sprinting.

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