Watch this Space – NorthmanTrader
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Watch this Space – NorthmanTrader

Sven Henrich via Northman Trader I’ll discuss markets in more detail this weekend, but wanted to share something we’re watching.Obviously this week has been wild with steep rallies and also just as steep selloffs. On the one hand we still have many stocks still attending the 80’s party rising in vertical fashion, $TSLA and $AMZN come...

Big Fed Lie – NorthmanTrader
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Big Fed Lie – NorthmanTrader

Sven Henrich via Northman Trader In real life you can always tell when someone has something to hide when they get really evasive in their answers. And boy was Jay Powell evasive in his press conference yesterday. Twice he was asked about the Fed’s policies causing risk assets to rise, twice he skirted with a...

Breakout – NorthmanTrader
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Breakout – NorthmanTrader

Sven Henrich via Northman Trader Like the mini Iran crisis earlier in the month the coronavirus is already ignored as markets are once again rallying hard today and in process are crushing all volatility. Gap, ramp and camp, the standard script.Another mini dip soon to be forgotten? Or a dead cat bounce? Markets became short term...

Trend Breaks – NorthmanTrader
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Trend Breaks – NorthmanTrader

Sven Henrich via Northman Trader It’s that time of the year again when another exuberant rally gets too cocky, produces massive overbought readings as everybody is trampling long into stocks, is ignoring all the warning signs and then some outside event pulls the plug. Soon the downside will be again blamed on the algos that...

Virus Fears – NorthmanTrader
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Virus Fears – NorthmanTrader

Sven Henrich via Northman Trader Some market perspectives on this Coronavirus. It was listed as one of the risk factors I outlined in Lurking Risks and it appears to now be indeed market impacting as the virus has now been reported in 13 countries and futures indication for tonight are showing risk off for the...

Rejection – NorthmanTrader
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Rejection – NorthmanTrader

Sven Henrich via Northman Trader And then it happened. Rejection. And with rejection come technical consequences. Perhaps the start of the first correction of 2020, the first correction since the Fed went wild on the intervention front in October. The confirmation remains outstanding, but technically vastly overbought markets are at high risk of a sizable...

80’s Party – NorthmanTrader
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80’s Party – NorthmanTrader

Sven Henrich via Northman Trader First they think you’re crazy and then they’ll join you. On January 14th I outlined a rather obvious appearing correlation between the Fed’s repo operations and the market’s behavior: Every day, no matter what happens or what data is thrown at this market the same pattern repeats: Markets are jammed...

Black Candle Magic – NorthmanTrader
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Black Candle Magic – NorthmanTrader

Sven Henrich via Northman Trader Did $NDX just trigger a sizable sell signal? Following the torrent rally since the Fed introduced QE in October $NDX had settled in a seemingly permanently overbought RSI reading above 70 beginning in mid December.  Indeed all of 2020 the daily RSI has been above 70, a very rare event....

Hubris – NorthmanTrader
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Hubris – NorthmanTrader

Sven Henrich via Northman Trader One day this bull market will end and the age of the central banking enabled debt bubble will be exposed for the hubris that it is and all the sins of “potential side effects” that central bankers warn about but never do anything about will come back to haunt all...

Lurking Risks – NorthmanTrader
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Lurking Risks – NorthmanTrader

Sven Henrich via Northman Trader According to the current market action there is no risk. None. Risk doesn’t exist. Whatever wobbles there may be on occasion it’s all priced in within a few minutes and markets proceed toward their daily ascent to new all time highs.Permanent asset price inflation. The driving force remains the same. QE...

Backlash – NorthmanTrader
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Backlash – NorthmanTrader

Sven Henrich via Northman Trader There’s an old adage: There are two guarantees in life: Death and taxes. Let’s modernize this a bit shall we? While it’s true even the rich still die these days (for now), but taxes are already a debatable question. After all taxes for corporations and the rich have come down...

The Tight Rope Market – NorthmanTrader
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The Tight Rope Market – NorthmanTrader

Sven Henrich via Northman Trader None of us can know where markets would be trading without the Fed’s constant massive liquidity injections, but now that the bubble recognition has gone mainstream (Bloomberg, FT) and acknowledged by at least one Fed president (Kaplan) I think it’s fair to say: Lower, much lower. But while investors continue...

Resistance – NorthmanTrader
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Resistance – NorthmanTrader

Sven Henrich via Northman Trader Does a liquidity driven momentum market that seemingly does not care about valuations, risk, open gaps and technical extensions face any resistance at all? Are there technical limits for a market that goes up every day, every week and every month? History teaches us that there are such limits and I’ll...

Market of the Gaps | NorthmanTrader
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Market of the Gaps | NorthmanTrader

Sven Henrich via Northman Trader The bubble keeps on bubbling, the never ending rally keeps on rallying and the charts keep getting ever more dangerously stretched.Intra-day price discovery is virtually absent as volatility remains woefully compressed and $SPX barely moves. It’s become quite the scene to watch an index representing 500 stocks with a combined...

Watch This! – NorthmanTrader
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Watch This! – NorthmanTrader

Sven Henrich via Northman Trader Don’t tell the complacent but the never ending rally is becoming ever more dangerous. As $ES is currently trading above 3300 it’s now not only extending over 10% above the 200MA it is also now already within a stone’s throw of what used to be considered aggressive price targets for...

He Knows – NorthmanTrader
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He Knows – NorthmanTrader

Sven Henrich via Northman Trader Last week we found out that Dallas Fed president Kaplan knows that the Fed is creating excess and imbalances in stocks. Yes, bloating the Fed’s balance sheet by over $400B  in four months has a massive impact on stock markets. And billions of repo liquidity unleashed each day can be...

Repo Lightening – NorthmanTrader
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Repo Lightening – NorthmanTrader

Sven Henrich via Northman Trader We’re still only a few days into 2020 but a very reliable trend has already emerged and bears watching. The trend: No matter what happens anywhere in the world or even if markets flush a quick 50 handles in overnight (i.e. on the recent Iran mini crisis) by morning all...

On the Cusp – NorthmanTrader
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On the Cusp – NorthmanTrader

Sven Henrich via Northman Trader Time for a quick update on Bitcoin. Following last year’s breakout out of its consolidation range following the big correction which ensued as it tagged the $20k level in 2017 Bitcoin’s 2019 rally ended after rejecting at its larger 1.618 fib. Since then $BTC has done nothing but slowly descend...

Mind the Gap – NorthmanTrader
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Mind the Gap – NorthmanTrader

Sven Henrich via Northman Trader Amid all the ferocious market rallying there’s a gap building and nobody seems to notice, and nobody seems to care. I say: Mind the gap. The banking index, much like the rest of the market, has been rallying furiously ever since the Fed began expanding its balance sheet on an...