Technical Charts
Summer in full bloom
With summer here and many taking much needed vacations, we aren’t surprised to see the equity markets continue their climb out of the hole. We know that 2022 has seen one of the worst equity performances on record and its highlighted in this chart here:
With all this money sitting around doing nothing, we can’t help but think a few whales have put their chips back onto the table, knowing full well two things:
The US Treasury can ill afford $1T in interest costs per year
The Federal Reserve will end up reducing their rate hikes and fall short of any meaningful balance sheet reductions
To all you dollar bears…well you better read up on how the global fiat system works, better yet, just look at the latest data of Japan and see just how much fiat they spent buying their own ponzi laced bonds over the last few weeks…yea that’s a hard NO on dollar destruction from the Econemotions camp.
In fact in regards to inflation, we saw this excellent graphic from Charlie Bilello on Twitter:
As far as we can tell 5y5y breakevens have peaked and are moving their way backdown, signaling to us that the REAL DEAL BOND PLAYERS view inflation as no longer a threat at the moment and its why oil prices have seen their peak hit last week as well:
Many of our readers knew we were bears at the $122 level and now the bears must reassert themselves here at the $113 area or risk a renewed attack higher. This round of buying is technical in nature and we feel that rallies should be sold into until $122 is taken out again. We know the US Consumer cannot withstand higher oil prices and that eventually supply constraints will be alleviated.
A few other charts we want to highlight:
Our tech heavy Nasdaq proxy continues to show life and should support a bullish Nasdaq theme:
2. The SP500 vs Nasdaq futures chart is also constructive for Nasdaq outperformance and will need to take out that low presented by the 50eMA:
3. The US yield curve is steeper as depicted by the 5s30 curve and this double bottom could lead into a further short end outperformance as rates stabilize:
4. Speaking of the 5YR and seeing as we touched upon Trillion dollar interest costs here is what we see from the same level of 5Y yields over the last two decades:
Finally Bitcoin which hit a major long term bottom and we truly feel Elon Musk and Peter Thiel will thrust Bitcoin into the next bull phase, we can’t tell you how or why, but we feel they will be the key components to the future of this technology:
Many of our readers reach out and ask what’s the best way to invest in this, well its up to you but we prefer if one is going to take risk capital and put it into Bitcoin that they use a reputable US Based exchange, that they set up weekly purchases of a certain dollar amount and then every month or quarter, pull your BTC off into cold storage. This takes diligence, this takes discipline but everything in life that is worth owning does, so this is no different. If you want to learn more feel free to reach out and we can try to help you navigate.
Till next time…
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