It’s back to bad news = good
I shall be away Wednesday and Thursday giving a MoneyWeek workshop and will have no further posts until Friday.
What a stinker of a US Jobs report today! Only 148,000 new jobs vs expectation of 185,000. Because traders believe the weak jobs growth (with the unemployment rate stuck at 7.2%) the Fed will have no alternative than to keep the QE spigots fully open.
Markets went wild with dollar being crushed. Interestingly, the USD/JY cross which I remain long, is pretty stable as Abenomics works its yen-weak magic. The race to the bottom is back on – yen vs dollar.
Treasuries also rallied – my C Account long T-Bond trade remains in good profit.
The Dow rallied on the news, but has fallen back. Here are my tramline quartet I am working:
The post-jobs reaction spiked the Dow above my upper line but quickly retreated back under the line.
Overshoots often mark a top, so I shall be watching this area closely, especially given the striking neg mom div.
The market may have made a “Sell the news” event – the next few days will be telling.
GOLD
Extended the huge rally today, but has hit the Fibonacci 50% retrace:
This could be a great candidate for a short trade.
