The video in this report is only accessible to members
The video in this report is only accessible to members

The SPX’s near-term decline is ongoing, regardless of some brief stabilization attempts on Monday.  While US indices are now in the window for a possible change of trend, more upside follow-through will be needed to have proof of an impending advance.  Technically I think this happens Tuesday/Wednesday and results in sharp rally for US Equities.

2-year yields fell at the fastest pace in over 35 years over the past three trading sessions, a full 100 basis point (bps) move in 2-year yields.  That hasn’t been seen since Black Monday in 1987 and certainly is making investors consider changing their economic forecasts to reflect this collapse in Financials.

While it’s premature to say that this Financial undoing might be a more important factor to the FOMC than CPI or PPI reports coming out this week, it’s worth reporting that Spread markets have moved enough to reduce expectations to Zero for any further FOMC rate hikes in March.  Nomura went so far as to forecast a 25 bps Rate cut and Quantitative Tightening halt in March.

US Dollar has begun to roll over coinciding with US Treasury yields pulling back.  This has helped precious and base metals start to rally while Crude oil has remained stubbornly unde...

Unlock this article with a FREE 30-Day Trial!

An FSI Pro, or FSI Macro subscription is required in order to access this content.

*Free trial available only on a monthly plan

Disclosures (show)

Get invaluable analysis of the market and stocks. Cancel at any time. Start Free Trial

Articles Read 2/2

🎁 Unlock 1 extra article by joining our Community!

You’ve reached your limit of 2 free monthly articles. Please enter your email to unlock 1 more articles.

Already have an account? Sign In

Want to receive Regular Market Updates to your Inbox?

I am your default error :)