NFP Day - The Bulls vs Bears
Alright let’s first take a look at this old cartoon from 1972 that we found:
Inflation has been a constant in the fiat debt system, yet it remains a stealth tax on our wages. It devalues our labor wage and the top 5% have been insulated from it due to massive debt and asset appreciation. The federal reserve's actions have ushered in a system designed to put only a few MegaCaps companies in absolute power. This is all by design. This illustration from the 1970s proves that the more things change the more they stay the same. Think about this the average household income back then was around $11k! Friedman was dead on when he said Inflation begins and ends in DC, boy was he spot on, rang true in 1979 when said it and its still true today!
So tomorrow is a big day, its Non Farm Payrolls Friday and as we noted in our earlier post, this number is bigger than the PCE print, why? Because long time Magnelibra readers know that we have been waiting for a negative print to put the Federal Reserve squarely in the cross hairs of main stream America. Once we get a negative NFP then the FRB will be forced to deal with an economy that is deteriorating and keeping rates higher for longer will not look good to the overall public. Will we get this negative print tomorrow? No we doubt it, but the expectations are for 170k and we could get a number substantially lower than that, maybe 125k or less. Then again we know all the numbers are fudged, so anything is possible. Even with Yellow laying off 30k peeps, we could see a 200k print if they really wanted to do it. Yea that’s the tinfoil hat in us, always questioning the data. Anyway we have PMI and ISM afterwards so be ready for those if the NFP is a dud. Although if we do get that lower than expected print, expect the equity markets to take it as a sign that deteriorating data is good news and we could just grind it higher all day:
We entitled this note as the Bulls vs the Bears and we are going to show you a few charts why this is indeed the case. First up the Nasdaq futures:
Here we can see the Nasdaq has been straight up for the last 5 trading sessions, jumping nicely from that bearish line we installed at 14949 and boy did they respect it. the broke it once then again, but have rallied 600 points right up to the top of our downward trend channel. So the bulls have taken it upon themselves to run right into major resistance just in time for NFP day! We suppose a close above 15550 tomorrow will negate this downtrend but if we do get a rejection and downside follow through then the bears have a chance to reassert control and get this back down to 14949.
As far as the SP500 it too has had a decent run up off the lows, however this move does remind us of the early Sept. 2022 rally off the lows but that came with a negative Vwap cross just like this one has and a trade below 4472 would give the bears the advantage here, above 4525, well bulls will continue to assert control:
Moving to Crude Oil, it too has run straight up into the highs and is faced to face with that 83.80 level once again. This is your standard cup and handle formation but the bulls would need a break and close above this level to continue upside momentum. A failed close below 80 again, would give the bears the advantage.
Now this next chart is a doozy, this is the Ten Year weekly futures chart and we have the fibs going back to 2007 for the low to 2020 as the high and wouldn’t you know it, the fib 0.382 retrace level sits right at 109-23 the area we have bounced over a point up from. As our note in the chart suggests, we can’t fathom the thought process of major pension fund managers not coming in here in droves. We keep thinking back to 2020 and ZIRP and how these guys would have killed for a treasury at 6%, boy how perceptions change…now all you hear is higher for longer and everyone is short US treasuries…hmm there is a reason we broke out from this area back in 2011, tested it in 2012 and 2013 with operation twist and QE2 and now, well right back to that area once again:
Alright, that is it for the analytics now lets move onto the trackers and todays settlements:
The GFBP futures position tracker saw no changes but ended the month on a good note:
As far as the MEGA8s, Amazon led the pack today as the total market cap of this crew back up above $12.1 Trillion:
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