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Friday, April 11, 2014

Market Thought... Hello Kitty

An orderly blood bath. 

The jobless claims were suppose to set the tone. It was a kick ass number. A number that should have sent the treasuries higher, and at least allowed the market to see a morning pop. That was very wrong logic. Instead the treasuries took a dump. And it had diarrhea throughout the day.


One of my biggest concerns is Putin-bear. There maybe enough geopolitical uncertainty to remove the premium from the market. That maybe happening considering the treasury demand in a robust economic enviornment.

My other lingering concern, and a correlation highlighted many weeks ago, is the Yen.

Six days ago, it looked to be in a breakdown mode. About to test the lows. But bounced, hard.

Six days ago the SP500 started the decline, although it was minimal. The real fun came the two days after.

The Yen continued to jump, and equities for America and Japan followed. (There was a bit of a pause as the markets rose, but that was due to dovish comments from the Fed.)

Over the last month, Yen down-equities up prevailed.

Some of the strength came over the last few days because of the lack of "additional" stimulus. (Although the BoJ still plans on spending a ton on stimulus. We also had the Chinese stay mum on more stimulus, but didnt effect their market.)

The 3% SP500 decline seems to be a market mechanics issue. 


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