S&P 500 selloff came – a juicy and profitable one. Bond market posture continues being negative, with no intraday comeback sticking. The pressure on the Fed is raised to the degree of 75bp hike expectation this week – the Fed would have to get more aggressive alongside other central banks if it wants to get some chance at taming inflation. It was precisely this market demand that caused the dollar to rise sharply yesterday as well. At this time, with so many gaps on sharply rising volume, both tech and value are taken to the cleaners – and neither finance nor real estate enjoy that bearish trend. What I‘ve talked about in recent weeks and months, is unfolding in a fastforward way.
The temporary capitulation can come on the Fed – while I don‘t expect Powell to sugarcoat anything (and I look for him to rather talk a tough inflation game than offer real economy support), the heavy selling is likely to pause. Even precious metals got caught up, and couldn‘t keep up the promising daily outperformance of Friday – this is what happens when everything gets sold indiscriminately, including commodities. Copper with silver are to suffer the most in the current, squeezed hard, environment – reflecting the real economy deterioration and vigorous mainstream denials of an approaching recession...
Let‘s get into the key richly annotated charts for today – precious metals:
and copper:
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