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Posts Tagged ‘cycle’

2012/10/18: Weekly Perspective into Equities signaled changing dynamic

October 18, 2012 Leave a comment

© 2012 ROHR International, Inc. All International rights reserved.

The weekly Report & Event Summary Perspective is available through the link in the right hand column. The Technical Projections and Select Comments from last week are also available and still relevant… with the notable exception of the critical equities decision explored in the General Market Observations and EXTENDED TREND IMPLICATIONS below.

This is one of those weeks that saw equities benefit from the combined influence of the now well-established central-bank support along with somewhat better data. As it typically takes a couple of quarters for the central-bank actions to impact the various economies, it leads one to wonder whether the central bank actions were really all that necessary. However, in this case we must allow that the anticipation of worse things to come is enough of a psychological drag to justify at least some of the central-bank largesse. What is most interesting is not that the central bank and supra-national actions have created a ‘risk on’ psychology, but more so how little is being done about the underlying problems which caused the central banks to feel their massive involvement was necessary in the first place.

And those are apparent both in Europe and the US…  

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2012/06/07: Central Bank-a-thon winds down, and so do risk assets

June 8, 2012 Leave a comment

© 2012 ROHR International, Inc. All International rights reserved.

It’s over. Central bank-a-thon’s three day run has ended. Good riddance. Amidst all of the other intense influences, this week’s scheduled central bank meetings and other activities were not necessarily helpful. Even the extended boost from Mr. Bernanke’s testimony and the somewhat unexpected People’s Bank of China rate cut was fading a bit by Thursday’s US Close.

Tuesday’s downbeat perspective from the Reserve Bank of Australia and Bank of Canada turned out to be the confirmation of the negative sentiment rather than the driver for further economic and equities weakness. That much was apparent from the resilience of the June S&P 500 future that held somewhat above the higher of its 1,260 and 1,245 supports. In fact, even in overnight electronic trading the worst it traded was 1,262.50.

And then on Wednesday it’s weak Euro-zone economic data all around into the ECB meeting and press conference. But do the equities break and bonds rally? Nope. And the Spanish minister saying that without assistance Spain was effectively shut out of the bond markets? No problem. Equities higher, euro higher, economic bellwether Australian dollar up as well. What in the world was happening?

 

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2012/05/17: Fed more likely to step in. Does it matter?

May 17, 2012 Leave a comment

© 2012 ROHR International, Inc. All International rights reserved.

It is one of those canards in the current equities market (and to a lesser degree economic) psychology that there is no more extensive QE (quantitative easing) at present by central banks outside of Japan. Nor is there any explicitly planned. Yet there could easily be more if conditions warranted.

This is a form of the central banks’ desire to both have their cake and eat it. Whatever one might call it (‘Bernanke Put’, etc.), the central banks have indicated that they are indeed ready to provide more liquidity if necessary due to deteriorating economic conditions or disorderly market activity.

Seems like a good way to underpin market psychology. Yet, will it really help all that much if the crunch returns? Frankly we’re skeptical. And the context of the FOMC minutes key passage yesterday highlights how the promise of easing or liquidity infusions in a crunch will not likely actually do much overall for the economy.

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2012/04/25: Waitin’ on the Fed: Highlights and Headwinds… which will win out?

April 25, 2012 Leave a comment

© 2012 ROHR International, Inc. All International rights reserved.

The FOMC rate decision and statement, Fed staff and member forecast revisions, and Chairman Bernanke’s press conference are alleged to be a major driver for the markets later today. Forget about it. It’s going to be more of the same, even if it is a supportive factor. It will be no surprise of the net focus will be continued improvement in US growth, even if at a slower pace than the Fed would like. More blame and derision will likely be (rightfully) heaped on the ineffective US administration and Congressional response to the problems in employment and housing. That is ultimately linked to the uncertain business environment regarding taxes, regulation and a bit of protectionism: Taxulationism(1) still rules. Yet, after all that only one thing matters…

There is still a ‘Bernanke Put’ ready to be implemented if necessary. There will almost certainly be a lack of any overt commitment to further immediate QE (quantitative easing.) That will be a disappointment to the aggressive bulls who would like to see the Fed continue to juice the economy and equities market (along with other risk assets.) However, that famous a cappella group Benny and the Doves are still singing the same tune: the Fed is prepared to step in if conditions should deteriorate. Voilà… the ‘Bernanke Put.’

And in spite of those two highlights, further central bank support may indeed be necessary at some point. It was most interesting that the equities Closed lower last Thursday in spite of 18 out of 18 corporate earnings announcements beating estimates. That was due to the increasing headwinds that are appearing from many macroeconomic quarters…

(1) Taxulationism © 2010 Alan Rohrbach & Jack Bouroudjian. All international rights reserved unless explicitly waived

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2012/04/09: Courtesy ‘Market Alert’ from Friday… Back in tomorrow

April 9, 2012 Leave a comment

© 2012 ROHR International, Inc. All International rights reserved.

Short & Sweet on the specific market comments in this post, because we are out today with the UK and Europe. That said, Friday’s TrendView Market Alert was also a view on some very interesting influences coming up early this week. Might this possibly be the beginning of a more substantial significant trend reversal in equities? That’s quite a bit more problematic into the beginning of a new quarter and the June S&P 500 future only dropping to initial support at 1,375-67 so far. 

And without a new trading high of any substance last week (i.e. only marginally above the previous week’s 1,415.50), there is not even a bona fide pattern top in place. While across time the equities might still be topping out, the seasonal phase and significant support below the market indicate any major trend reversal will most likely occur on a ‘trading’ basis. There will more likely be some further filling out in a more convincing top between the mid-1,300 and low-1,400 area than any further sharp capitulation.

That said, there are a couple of wild cards out there.

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2012/03/23: Will Govvies get the ‘benefit’ of Equities ‘doubt’? Yes and No.

March 23, 2012 Leave a comment

© 2012 ROHR International, Inc. All International rights reserved.

In spite of the buoyancy of the German Bund, govvies are still acting more like a market entering an intermediate term trend reversal to the downside. As we have not seen that since QE2 anticipation and implementation back in August-November 2010, some perspective might be useful. What we know for certain is classical macro-technical equities vs. govvies counterpoint trend activity is back.

Yet, that can appear confusing at times because of the leads and lags. Govvies tend to “interpret” the equities trend rather than respond with any immediate inverse activity. This was the case both before and after last week’s sharp trend activity in both asset classes. Govvies that held up well in the face of the previous equities rally were crushed by the June S&P 500 future push above 1,367-69 last week Tuesday.

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2011/12/13: Quick Post: Apologies & Observations and Weekly Reports & Events Calendar Now Available

December 13, 2011 3 comments

© 2011 ROHR International, Inc. All International rights reserved.

The full calendar is available through the link in the right hand column. Apologies for this taking until today, but we were called away from the office yesterday afternoon, and have been busy with a critical matter this morning. It seems that LIFFE (London International Financial Futures Exchange) was a bit less than aggressive in alerting the data vendors to the change in the Long Gilt future delivery basis from 6.0% to 4.0%.

We have been busy the last couple of days, and especially this morning consulting with our own very adept data vendor on some final considerations for the timely necessary conversion of the historic data to make it relevant for the new 4.0% basis contracts. This is especially important as the volume has already shifted to the first of these, the March 2012 Gilt future.

This is such a robust week once again, it is impossible to include anything but a fraction of the major influences in an overview. Yet, key aspects will be those that relate to the continuing debt and fiscal reform problems in Europe and a heightened US influence once again.

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