Category Archives: Bonds

Meme Stocks and Market Top

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The Fed surprised everyone with 2024 rate cuts projection during the December 12-13 2023 meeting.  The market immediately thought of the first rate cut coming in March 2024 therefore the rally continued into February.  The Fed realized the market’s unrealistic expectations about rate cuts, and has come out several times to talk down

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Don’t Fight the Fed

In December 17-18 2023 Fed meeting, Fed Chair Powell talked about rate cuts in 2024 that added fuel to the fire for the Christmas rally in bonds and stocks.  Both bond traders and equity traders immediately priced in aggressive rate cuts starting as early as in March 2024.  In January 30-31 Fed meeting, Fed Chair Powell emphasized no

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Signs of a Slowing Rally

Last week the DOW and small caps outperformed the S&P 500 and NASDAQ.  It created an appearance of a positive divergence of breadth broadening.  A breadth broadening is needed for a true bull market.  But can a bull market be led by lower quality small cap stocks without the market leader such as Nvidia participating?  Nvidia had a

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The Bond Market Has Spoken

The 10-year treasury yield formed a top last week by trading below 4.827% when the US Treasury Department announced a better than expected next quarter borrowing plan.  The subsequent Fed meeting was dovish.  To top if off, the less than expected jobs data further crashed the 10-year treasury yield.  It’s weird that the stock market cheered

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A Make-or-Break Week in the Bond Market

The mega tech earnings report with the exception of Tesla has been so far so good.  The growth engine in Microsoft, Google, Meta and Amazon are intact despite the tight monetary conditions.  But the stock market reaction to the good earnings report has been muted.  The mood is sour.  Any minor earnings miss has been severely punished.  The entire stock

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Cycle Forecast

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