Record low correlations between stocks are very likely to increase after the tax reform gets fully priced-in in the second half of 2018. We estimate this will push index volatility up by ~3 points. Perhaps the best example of the impact of correlation on reducing S&P 500 volatility was the market move on Nov 29,…
As we get closer to year-end and into 2018, we expect to see a number of price target and earnings forecasts for the major stock market indices, especially the Dow Jones Industrial Average and the S&P 500. From time to time, these can be all over the board as they are often subject to the…
Financial markets have just one full week of trade left in 2017. Here is what major currencies, commodities and equity indexes might do with it. US Dollar Forecast: US Dollar Looks Vulnerable Through the End of 2017 The US Dollar plunged despite a seemingly hawkish lead from the Federal Reserve. It will probably struggle to find a…
In the last letter, I discussed the evidence building up warning that we were getting close to an intermediate top. I had also mentioned that there appeared to be some correlation between GDX making a 52-wk low and top in SPX. Ideally, the 52-wk cycle of GDX was supposed to bottom next week, but it…
Preface to all three parts: 2017 has been an exciting year for Slope, and I went looking among the literally thousands of posts this year to find what I considered the most intriguing. I earmarked twenty-one of them, and since that is too much for a single post, I’ve broken them into three equal parts (I’ll publish…
US stocks had another impressive week with three of the four main indexes making all-time highs. The Dow closed +1.08% and the NASDAQ 100 regained its footing, closing +1.91 %. Our risk gauges remain strongly bullish. The news on Capitol Hill was good for stocks, as the proposed tax bill looks ripe for passage. Right…
The Fed’s recent statement and press conference saw the market respond as if they were dovish. That goes against the actions which were a rate hike, a promise of three hikes next year, increasing the balance sheet runoff to $20 billion per month, and increasing the dot plot by one hike in 2020. Overall, those…
The Australian dollar changed course and made a move to the upside, enjoying the great jobs report. Will it continue higher? The RBA meeting minutes stand out. Here are the highlights of the week and an updated technical analysis for AUD/USD. Australia reported a gain of no less than 61.6K jobs in November, far better than expected…
‘On the cusp of great growth’ is basically the term you’ll hear, now that a solid tax bill has been detailed, and which presumably will pass muster with a vote next week. Unless too many ‘more’ Congressmen or Senators quickly resign before a flood of additional ‘sexual harassment’ allegations sweep across the media. (Nobody approves, but…
