The question that scares the bulls and the Fed - News and Current Events | futures io social day trading
futures io futures trading

The question that scares the bulls and the Fed
Updated: Views / Replies:156 / 0
Created: by kbit Attachments:0

Welcome to futures io.

(If you already have an account, login at the top of the page)

futures io is the largest futures trading community on the planet, with over 90,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.

At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors – all of which you can find on futures io, utilizing our social trading environment.

With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you don’t need to worry about fake reviews.

We are fundamentally different than most other trading sites:
  • We are here to help. Just let us know what you need.
  • We work extremely hard to keep things positive in our community.
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts.
  • We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

Thread Tools Search this Thread

The question that scares the bulls and the Fed

  #1 (permalink)
Elite Member
Aurora, Il USA
Futures Experience: Advanced
Platform: TradeStation
Favorite Futures: futures
kbit's Avatar
Posts: 5,872 since Nov 2010
Thanks: 3,301 given, 3,332 received

The question that scares the bulls and the Fed

Inter-market movement continues to look more and more fragile with several negative trends expressing themselves. I have been noting in my last few writings that bonds are strengthening despite the "rising rate environment" meme and that behaviorally things are acting more normal.

Big down days result in defensive, low-beta leadership. Big up days are the opposite, as more aggressive areas uniformly outperform. However, unlike 2013, the relationships are normalizing within the market. I'm pretty excited for that, as those who remember my major calls in 2011 and 2012 may soon recognize a more familiar market.

The yield curve is flattening, and the payroll report did change many things beneath the surface. Our ATAC models used for managing our mutual fund and separate accounts fully got out of our stock exposure last week and are now in full deflation pulse mode through a trade in duration.

Contrarian? Yes. But the fact is that the reflation disconnect which threw off many dynamics last year remains very much in place. The Fed has begun to acknowledge the risks of QE, small-cap stock valuations, and has started to pull back on bond buying. Meanwhile, P/E expansion of last year looks more and more suspect with some disappointing results in the large-cap space.

Every single Nouveau Bull who got last year right needs to start asking one question and one question only: If the Fed's wealth effect were effective, why are consumer stocks suddenly collapsing at the same time China's manufacturing and exports are surprisingly weak?

The entire Fed strategy all along is to try to juice the value of assets on the hopes that it makes people "feel" better about their financial situation, spend more, and create a virtuous cycle of growth through increased velocity of money. Wouldn't you think that after such a strong 2013 that consumers would go spending like mad and growth would seriously pick up? Wouldn't that mean retailing stocks would do well?

It's not happening. This is a fragile juncture purely because if the market begins to realize that the Fed was actually ineffective in juicing reflation, and growth/earnings do not pickup, then last year was unjustified. Retailers bottomed before the March 2009 low. What does it mean then if they just topped, something which I alluded to on Bloomberg at the very end of December?

Take a look below at the price ratio of the SPDR S&P Retail Index ETF XRT +0.12% relative to the Consumer Discretionary Select Sector SPDR ETF XLY -0.71% . As a reminder, a rising price ratio means the numerator/XRT is outperforming (up more/down less) the denominator/XLY. A falling ratio means the opposite. For a larger chart, please click here .

Yes, consumer stocks have been weak. But retailers have been brutal in the last few weeks. Wealth effect? Mission accomplished? Reflation? Bull market? Not so much. If, indeed, consumer stock information gradually diffuses to broad market averages (a concept brought about in two white papers I will be releasing shortly), then shouldn't the Gray-Haired Bears be salivating over what's to come?

The question that scares the bulls and the Fed - MarketWatch

Reply With Quote


futures io > > > > The question that scares the bulls and the Fed

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Upcoming Webinars and Events (4:30PM ET unless noted)

Jigsaw Trading: TBA

Elite only

FuturesTrader71: TBA

Elite only

NinjaTrader: TBA

Jan 18

RandBots: TBA

Jan 23

GFF Brokers & CME Group: Futures & Bitcoin

Elite only

Adam Grimes: TBA

Elite only

Ran Aroussi: TBA

Elite only

Similar Threads
Thread Thread Starter Forum Replies Last Post
Fed Will Drive the Herd as Bulls Run Toward Record Quick Summary News and Current Events 0 March 15th, 2013 10:40 PM
And, They're Off! Market Bulls May Keep Running Quick Summary News and Current Events 0 March 8th, 2013 09:40 PM
Market Bulls Stroll Towards Further Gains as Fed Meets Quick Summary News and Current Events 0 January 28th, 2013 10:40 PM
The Chart That Scares The "1%" The Most Victory Trader News and Current Events 1 June 21st, 2012 12:48 AM
Question to Fed: How to exit without losing credibility? GridKing News and Current Events 0 March 11th, 2012 08:17 AM

All times are GMT -4. The time now is 01:00 PM.

Copyright © 2017 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432,
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts
Page generated 2017-12-14 in 0.08 seconds with 19 queries on phoenix via your IP