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http://track.com/articles/the-weekly-track-ashes/
The Southern Hemisphere had a ring of fire solar eclipse today. Shouldn’t matter much to anyone but somehow the metaphor of an eclipse and the long history of fear maybe something to ponder as we try to make sense of the week ahead. Eclipses are omens of destruction in Europe and for China its associated with the health of the emperor – both seem cutting edge to the larger worries nagging at the month-end long positions of risk assets. Nothing much happened last week – markets were orderly - with equities nudging mostly forward, bonds rallying sharply on less fear of the FOMC and ongoing actions from the ECB and BOJ. The Fed minutes revealed that they want to raise rates “fairly soon†but likely not March. The speeches from Fed’s Yellen and Fischer and others in the week ahead will test this logic. For the USD, it held its modest gains for the third week and tested the January lows for the EUR. JPY stood out as the safe-haven even as emerging markets continue
d to win with the clipping of coupons attractive in a market mostly confused about the big picture. The ring of fire today isn’t a total solar eclipse but rather a geometric one – something that purest will note drives less fear but forces compromise as theory meets practice. This will be the central issue for US President Trump in the week ahead has he gives his first speech State of the Union Address to Congress – with many questions about his policy being at odds with the leadership of the “swamp.†The other outcome for the week ahead is about the calendar with start of Lent coming with the start of March – and an expected 40 days of giving up something – perhaps that too will mean less enthusiasm for “there is no alternative†or TINA trading that has captured equities for the last 3 months. We are due a test of will – a visit to the desert and to fasting may be in order. The mood is robust, the omens less auspicious and the risk for a drawdown seems
high.
The Weekly Track ashes
- The Weekly Track - Ashes by Bob Savagehttp://track.com/articles/the-weekly-track-ashes/
The Southern Hemisphere had a ring of fire solar eclipse today. Shouldn’t matter much to anyone but somehow the metaphor of an eclipse and the long history of fear maybe something to ponder as we try to make sense of the week ahead. Eclipses are omens of destruction in Europe and for China its associated with the health of the emperor – both seem cutting edge to the larger worries nagging at the month-end long positions of risk assets. Nothing much happened last week – markets were orderly - with equities nudging mostly forward, bonds rallying sharply on less fear of the FOMC and ongoing actions from the ECB and BOJ. The Fed minutes revealed that they want to raise rates “fairly soon†but likely not March. The speeches from Fed’s Yellen and Fischer and others in the week ahead will test this logic. For the USD, it held its modest gains for the third week and tested the January lows for the EUR. JPY stood out as the safe-haven even as emerging markets continue
d to win with the clipping of coupons attractive in a market mostly confused about the big picture. The ring of fire today isn’t a total solar eclipse but rather a geometric one – something that purest will note drives less fear but forces compromise as theory meets practice. This will be the central issue for US President Trump in the week ahead has he gives his first speech State of the Union Address to Congress – with many questions about his policy being at odds with the leadership of the “swamp.†The other outcome for the week ahead is about the calendar with start of Lent coming with the start of March – and an expected 40 days of giving up something – perhaps that too will mean less enthusiasm for “there is no alternative†or TINA trading that has captured equities for the last 3 months. We are due a test of will – a visit to the desert and to fasting may be in order. The mood is robust, the omens less auspicious and the risk for a drawdown seems
high.
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Robert Savage
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