Tips To The Rescue
S&P 500 and Nasdaq positioning for TSM earnings that I extensively telegraphed in full in yesterday‘s article (the opportunity smelled smashing) and also on Twitter, came true with strong beats. The positioning run continued, and the soft patch was cured by a TIPS auction leading as well to improvement in S&P 500 breadth. The defensive positioning was gone, and tech was accompanied by communications, discretionaries and materials to the upside.
Gold likewise continued higher off my $2,005 bottom call. Asset prices welcomed both Philly Fed manufacturing and building permits (unemployment claims below expectations favored though no landing scenario, which was ultimately disregarded by market action) – and ignored the daily rise in yields taking 10y rate all the way to 4.17%.
Another yesterday repeated call – for USD to face stiff resistance at 103.50 – keeps holding. It looks like there is a limit to how much steam can be let off via the hawkish talk when all met in Davos.
Gold, Silver and Miners
(Click on image to enlarge)
The caption says it all – gold bias keeps being bullish since the bottom call, but careful about greater than $7 downswings, protect your open gains accordingly.
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