toptober

market vibes

October 4…) 

“Risk comes from not knowing what you're doing.” Buffett 

NFP today , ADP came in 143 vs 125 on Wednesday. The BBG survey sees 150k vs 142 last so my guess is the Goldilocks number, which the stock market wants, is 140/ 160. Knowing the BLS’ elasticy for revisions when the “environment” as Ishiba likes to say is more favorable we’ll get another September NFP after the election. Therefore in light of past BLS pre-election tendencies, a cynic would not be surprised to see a steamy number.  

Keeping the temps of data in mind… 

I saw a fun podcast by a couple guys talking about trading Thursday morning in which they mention a scion of the game Druckenmiller telling the audience at Jim Grant’s fall conference he’s short bonds with both hands and both feet. Last night scrolling thought the charts I saw a “1 bar down” in the long bond.  

I often say rallies in downtrends make the market weaker and this is an excellent example. If you are a student of Wells Wilder’s Directional Movement Index as I am, you’ll know in this instance (30 yr bonds chart below), buyers attempted to take control of the auction (single blue bar) and failed (red bar extending the trend lower). Simply put, this is the market speaking in a complete thought; a sentence saying, “I want to go down.”  

Check out The Macro Dirt podcast but be sure to keep the toddlers out of your office when you do…. It’s a little spicy.  

In other markets… oil and a quick dive into why silver miners are such relative dogs