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Predicting the short term direction of the markets is of course a fool’s errand. Nonetheless it seemed very unlikely that this particular Monday would be so positive. The markets disconnect from events continues to shock me. I guess FD can take a victory lap. At least for now.
It's almost a chess game- if anyone takes out Iran's oil production that would cut off their main income source, and also really irritate the Chinese who use most of the Iranian production.
It's almost a chess game- if anyone takes out Iran's oil production that would cut off their main income source, and also really irritate the Chinese who use most of the Iranian production.
Predicting the short term direction of the markets is of course a fool’s errand. Nonetheless it seemed very unlikely that this particular Monday would be so positive. The markets disconnect from events continues to shock me. I guess FD can take a victory lap. At least for now.
Why? I already said it in the other thread. BTW, Oil was down 7-8% today.
This Iran war is in 1st inning. Those who took the victory lap will be proven pre-matured. Israeli keeps on bombing Iran after the American did. Both sides are exchanging missile attack.
Are they aiming at regime change? We know how well that works in Iraq and Afghanistan.
@Hank. I must have missed that call but if I did answer that one I certainly would not have believed it. But I sure went to sleep last night expecting a really bad day …what do I know? Nothin.
@Hank. I must have missed that call but if I did answer that one I certainly would not have believed it. But I sure went to sleep last night expecting a really bad day …what do I know? Nothin.
We talked about this on multiple occasions. When we began dropping bombs on Iraq in 91 up went the market. Of course this time around will it remotely be anything like that period? Then we were coming off a mini bear market. This time around we have been in a bull for several months already. Congrats to those who have been positioned and sitting tight the past many months.
Edit. By the way @larryB. Thank you for your honesty.
@Junkster. Some observers think this time is different….. the sum total of everything that has happened since Inauguration Day is so far from normal that analogues to other markets, other wars , other trade wars just don’t hold water. But the markets want to keep going up. Luckily I don’t have FOMO.
Is this a bull market since April 8 (I bought on that date heavily), or was this all a relief rally off of lows as the full extent of the TACO trade was impressed on investors?
I do believe that this is a long bull market since the start of 2023, with some disruptions. And that we ight be up 10-15% YTD, without the chaos of trade/tariffs. In a weaker market, we might be still down 20%. Just my opinion.
Equities may well be in a bull market, but TACO boy cannot stay out of his own way. He is the major risk to the health of this bull. Markets should persevere, or so we hope. They have shown much resiliency this year in eeking out gains.
I'll maintain some allocation to gold for the next 3 years regardless of price.
Most interesting will be how our credibility takes a hit once Powell is no longer the Fed Chairman, and it's just some lackey cutting rates at TACO's discretion. Something to look forward to.
Something does not jive after US bombed Iran. Oil price dropped instead of up. Gold went down as if inflation is coming down. I am staying with our bonds and they will do fine this year.
for those in risk off/wealth preservation mode, mkt indicators seem peaking. thus, am trimming gains+losses in equity where i can, limits are getting bids.
found an unusual amount of agreement from various macro sources. (stonex, zeihan, jpm, poskar, klement,ferguson) convergence of events june-july : - as q2 positive earnings reported, look for unusual amount of weak\no earnings forecasts for q3 period - capex going below trend, but ignore overcapacity signal from buildouts maturing - trump tariff baseline at 10% is still quadruple of 2024. ~50% sentiment that trump will not taco >10% for most, china remains highest. - first sign of shelf shortages during china shipping pause in spring - expected senate vote on budget bill adding $3t debt
(again, oil shock and war cost excluded) at least 2 sources indicated ~15% mkt decline would be select buying opportunity. meh.
Don't feel bad. The following commentary is from Jeff DeMaso's IVA Weekly Brief published June 25.
"I’m repeating myself here—but it bears repeating: you can’t profitably trade the headlines."
"If you were trying to profit from trading energy stocks in June, you needed to act before the headlines. You had to buy before the U.S State Department withdrew personnel from the region or Israel launched its first missile at Tehran. And you had to sell last Friday, anticipating that U.S. bunker-buster strikes on Iran’s uranium enrichment sites would lead to de-escalation."
"In fact, if you bought Energy Index after the missiles started flying, you’ve actually lost money on the trade! Making that trade even more painful: Total Stock Market Index is up 2.1% since Israel’s first strike."
"Of course, the conflict isn’t over, and the energy stocks could deliver gains from here. But this is just another case study in how hard—nearly impossible—it is to trade the headlines and come out ahead."
How many times were popular agreements wrong? so many times. Trading headlines is a bad idea. Try to figure out what to do yourself. If you can't, stop reading the "experts" and hardly trade.
"Total Stock Market Index is up 2.1% since Israel’s first strike."
Comments
It in likely that Iran has been forewarned that any interference at the Strait would result in the destruction of their oil production infrastructure.
I already said it in the other thread.
BTW, Oil was down 7-8% today.
The market can disconnect for extended periods. It's a fickle little thing.
Are they aiming at regime change? We know how well that works in Iraq and Afghanistan.
Edit. By the way @larryB. Thank you for your honesty.
I do believe that this is a long bull market since the start of 2023, with some disruptions. And that we ight be up 10-15% YTD, without the chaos of trade/tariffs. In a weaker market, we might be still down 20%. Just my opinion.
I'll maintain some allocation to gold for the next 3 years regardless of price.
Most interesting will be how our credibility takes a hit once Powell is no longer the Fed Chairman, and it's just some lackey cutting rates at TACO's discretion. Something to look forward to.
In the meantime:
The taxable account is as fully invested as it ever was.
The IRA has mostly gone to money markets and short duration bond funds that are supposedly performing better than inflation.
I sleep as well as I ever have.
thus, am trimming gains+losses in equity where i can, limits are getting bids.
found an unusual amount of agreement from various macro sources. (stonex, zeihan, jpm, poskar, klement,ferguson)
convergence of events june-july :
- as q2 positive earnings reported, look for unusual amount of weak\no earnings forecasts for q3 period
- capex going below trend, but ignore overcapacity signal from buildouts maturing
- trump tariff baseline at 10% is still quadruple of 2024. ~50% sentiment that trump will not taco >10% for most, china remains highest.
- first sign of shelf shortages during china shipping pause in spring
- expected senate vote on budget bill adding $3t debt
(again, oil shock and war cost excluded)
at least 2 sources indicated ~15% mkt decline would be select buying opportunity. meh.
The following commentary is from Jeff DeMaso's IVA Weekly Brief published June 25.
"I’m repeating myself here—but it bears repeating: you can’t profitably trade the headlines."
"If you were trying to profit from trading energy stocks in June, you needed to act before the headlines.
You had to buy before the U.S State Department withdrew personnel from the region or Israel launched
its first missile at Tehran. And you had to sell last Friday, anticipating that U.S. bunker-buster strikes
on Iran’s uranium enrichment sites would lead to de-escalation."
"In fact, if you bought Energy Index after the missiles started flying, you’ve actually lost money on the trade! Making that trade even more painful: Total Stock Market Index is up 2.1% since Israel’s first strike."
"Of course, the conflict isn’t over, and the energy stocks could deliver gains from here.
But this is just another case study in how hard—nearly impossible—it is to trade the headlines and come out ahead."
https://www.independentvanguardadviser.com/weekly-brief-from-middle-east-tensions-to-vanguards-big-reorg
How many times were popular agreements wrong? so many times.
Trading headlines is a bad idea. Try to figure out what to do yourself. If you can't, stop reading the "experts" and hardly trade.
"Total Stock Market Index is up 2.1% since Israel’s first strike."
Israeli stock index (EIS) is up over 12%.