Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Chinese Tech Stocks CCP Paranoia and Best AI Tech Stocks ETF - 26th Oct 21
Food Prices & Farm Inputs Getting Hard to Stomach - 26th Oct 21
Has Zillow’s Collapse Signaled A Warning For The Capital Markets? - 26th Oct 21
Dave Antrobus Welcomes Caribou to Award-Winning Group Inc & Co - 26th Oct 21
Stock Market New Intermediate uptrend - 26th Oct 21
Investing in Crypto Currencies With Both Eyes WIDE OPEN! - 25th Oct 21
Is Bitcoin a Better Inflation Hedge Than Gold? - 25th Oct 21
S&P 500 Stirs the Gold Pot - 25th Oct 21
Stock Market Against Bond Market Odds - 25th Oct 21
Inflation Consequences for the Stock Market, FED Balance Sheet - 24th Oct 21
To Be or Not to Be: How the Evergrande Crisis Can Affect Gold Price - 24th Oct 21
During a Market Mania, "no prudent professional is perceived to add value" - 24th Oct 21
Stock Market S&P500 Rallies Above $4400 – May Attempt To Advance To $4750~$4800 - 24th Oct 21
Inflation and the Crazy Crypto Markets - 23rd Oct 21
Easy PC Upgrades with Motherboard Combos - Overclockers UK Unboxing - MB, Memory and Ryzen 5600x CPU - 23rd Oct 21
Gold Mining Stocks Q3 2021 - 23rd Oct 21
Gold calmly continues cobbling its Handle, Miners lay in wait - 23rd Oct 21
US Economy Has Been in an Economic Depression Since 2008 - 22nd Oct 21
Extreme Ratios Point to Gold and Silver Price Readjustments - 22nd Oct 21
Bitcoin $100K or Ethereum $10K—which happens first? - 22nd Oct 21
This Isn’t Sci-Fi: How AI Is About To Disrupt This $11 Trillion Industry - 22nd Oct 21
Ravencoin RVN About to EXPLODE to NEW HIGHS! Last Chance to Buy Before it goes to the MOON! - 21st Oct 21
Stock Market Animal Spirits Returning - 21st Oct 21
Inflation Advances, and So Does Gold — Except That It Doesn’t - 21st Oct 21
Why A.I. Is About To Trigger The Next Great Medical Breakthrough - 21st Oct 21
Gold Price Slowly Going Nowhere - 20th Oct 21
Shocking Numbers Show Government Crowding Out Real Economy - 20th Oct 21
Crude Oil Is in the Fast Lane, But Where Is It Going? - 20th Oct 21
3 Tech Stocks That Could Change The World - 20th Oct 21
Best AI Tech Stocks ETF and Investment Trusts - 19th Oct 21
Gold Mining Stocks: Will Investors Dump the Laggards? - 19th Oct 21
The Most Exciting Medical Breakthrough Of The Decade? - 19th Oct 21
Prices Rising as New Dangers Point to Hard Assets - 19th Oct 21
It’s not just Copper; GYX indicated cyclical the whole time - 19th Oct 21
Chinese Tech Stocks CCP Paranoia, VIES - Variable Interest Entities - 19th Oct 21
Inflation Peaked Again, Right? - 19th Oct 21
Gold Stocks Bouncing Hard - 19th Oct 21
Stock Market New Intermediate Bottom Forming? - 19th Oct 21
Beware, Gold Bulls — That’s the Beginning of the End - 18th Oct 21
Gold Price Flag Suggests A Big Rally May Start Soon - 18th Oct 21
Inflation Or Deflation – End Result Is Still Depression - 18th Oct 21
A.I. Breakthrough Could Disrupt the $11 Trillion Medical Sector - 18th Oct 21
US Economy and Stock Market Addicted to Deficit Spending - 17th Oct 21
The Gold Price And Inflation - 17th Oct 21
Went Long the Crude Oil? Beware of the Headwinds Ahead… - 17th Oct 21
Watch These Next-gen Cloud Computing Stocks - 17th Oct 21
Overclockers UK Custom Built PC 1 YEAR Use Review Verdict - Does it Still Work? - 16th Oct 21
Altonville Mine Tours Maze at Alton Towers Scarefest 2021 - 16th Oct 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Bull Run Ignoring Inflation

Stock-Markets / Stock Market 2021 Jul 01, 2021 - 07:11 PM GMT

By: Monica_Kingsley

Stock-Markets

S&P 500 reached new highs powered by technology, even as value or Russell 2000 took a daily breather. With VIX going nowhere, and the put/call ratio turning complacent, the path of least resistance remains higher, and not even emerging markets are derailed by the strong dollar. While yesterday‘s stock market upswing was a defensive one as the credit markets and tech internals reveal, there is little to upset the cart – Thursday‘s ISM manufacturing will probably show solid expansion, and it would be only Friday‘s non-farm payrolls (better said what effect these could have on the Fed‘s labor market rationale for keeping the punch bowl available) to bring about volatile trading.

With the Fed support intact and fiscal one not retreating either, with inflation expectations not spiking, the current data are disregarded to a degree. Incorrectly in my view as Friday‘s:

(…) PCE deflator ... figure aligned with the inflation camp much better, yet the marketplace arguably expects better inflation data ahead - the transitory inflation thesis is the mainstream one, but I‘m still of the opinion that inflation wouldn‘t decline as meaningfully, especially when measured through CPI, PPI, and import-export prices, proving more persistent than generally appreciated.

The Fed is behind the curve in taking on inflation even according to El-Erian, and its monetary actions support both the Treasury markets and the red hot real estate. The lull in Treasuries is likely to last into the autumn, and the ensuing yields increase would reflect both the economic recovery and newfound appreciation of inflation. I maintain we‘re still in a reflation – a period of economic growth stronger than inflation – in a multi-year economic expansion, and also that inflation will surprise those considering it transitory (as if this word had any meaning still attached, after all the time length redefinitions). As a side note, if only consumer price inflation was measured without substitution, hedonistic adjustments, and owner‘s equivalent rent. In this environment, tech is unlikely to be derailed, and value will play catch up.



Precious metals are feeling the heat of inflation not being taken seriously, and miners are leading to the downside – not a bullish short-term perspective. Silver is inspired by copper‘s short-term woes more than by the CRB resilience. Coupled with the dollar keeping high ground, both metals are facing stiff headwinds.

Crude oil is likely to shake off the production quota increase uncertainty looming over the coming OPEC meeting – the correction has been thus far muted, with oil stocks bearing the brunt of the selling pressure. But that‘s nothing that couldn‘t be repaired over the nearest weeks – XLE would contribute to stock market gains, and black gold would remain way more resilient than oil stocks.

Cryptos are scoring gains as the base building hypothesis grows in strength, and the bulls have the initiative.

Let‘s move right into the charts (all courtesy of www.stockcharts.com).

S&P 500 and Nasdaq Outlook



S&P 500 is going higher, with tech stocks once again in the driver‘s seat.

Credit Markets

  1. The risk-off turn in the credit markets wasn‘t overly strong.

Technology and Value



Tech was primarily driven by $NYFANG as other sectors either held ground, or modestly declined.

Gold, Silver and Miners



Gold and miners still keep going nowhere, and the yesterday mentioned creeping deterioration is increasing the danger of a broader short-term decline.



Also the GDX:GLD ratio ($HUI:$GOLD isn‘t properly calculated today unfortunately) reflects the momentary straits in the precious metals market. Silver remains under pressure as much as copper does.

Bitcoin and Ethereum



Quite a few good days in a row in the crypto space – the bulls are on the move.

Summary

S&P 500 keeps consolidating yesterday‘s late session gains, preparing for a fresh upswing.

Gold and silver are on the defensive in the short-term, and miners aren‘t pointing in the bullish direction at the moment – precious metals keep ignoring real rates and inflation.

Crude oil chart remains bullish, and the steep energy sector decline won‘t be of a lasting duration.

Bitcoin and Ethereum are scoring gains as the base building hypothesis grows in strength, and overcoming the recent corrective highs followed by the 200-day moving averages, are the next medium-term objectives.

Thank you for having read today‘s free analysis, which is available in full at my homesite. There, you can subscribe to the free Monica‘s Insider Club, which features real-time trade calls and intraday updates for both Stock Trading Signals and Gold Trading Signals.

Thank you,

Monica Kingsley

Stock Trading Signals

Gold Trading Signals

www.monicakingsley.co

mk@monicakingsley.co

* * * * *

All essays, research and information represent analyses and opinions of Monica Kingsley that are based on available and latest data. Despite careful research and best efforts, it may prove wrong and be subject to change with or without notice. Monica Kingsley does not guarantee the accuracy or thoroughness of the data or information reported. Her content serves educational purposes and should not be relied upon as advice or construed as providing recommendations of any kind. Futures, stocks and options are financial instruments not suitable for every investor. Please be advised that you invest at your own risk. Monica Kingsley is not a Registered Securities Advisor. By reading her writings, you agree that she will not be held responsible or liable for any decisions you make. Investing, trading and speculating in financial markets may involve high risk of loss. Monica Kingsley may have a short or long position in any securities, including those mentioned in her writings, and may make additional purchases and/or sales of those securities without notice.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in