Friday was a glorious session that saw the moves that made skeptics think again and fence-sitters lean forward.

But bears have made monster bets and are choosing to defend them by adding even more cash. Conveniently, the bears got help from Moody’s, which lowered America’s credit rating from AAA.

Treasury Secretary Scott Bessent calls the move from Moody’s a “lagging indicator.” He was being polite.

The timing of Moody’s call dovetails with classic short-term overbought conditions (see the Relative Strength Index (RSI) and the Rate of Change (ROC)).

I want to see 5760 hold on a closing basis.

Today’s Session

They are out there this morning laying it on thick.  For the record, this was the stock market reaction when Moody’s rivals cut their US rating from triple A. 

The anti-America rhetoric is being played up again, as yields move higher and the dollar moves lower.

The 30-year yield (TYX) is above 5.0%.

The 10-year yield (TNX) is above 4.50%.

Course of Action

Hang tight the knee-jerk reaction, which is nearly as dire as I thought it could be on Friday evening, but the terror campaign is heating up big time.

It will be interesting to see what Fed officials have to say about this today, and the updated LEI should be compelling.

Tweet

 

Home | Products & Services | Education | In The Media | Help | About Us | Disclaimer | Privacy Policy | Terms of Use | All Rights Reserved.