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Strategies & Market Trends : John Pitera's Market Laboratory

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sixty2nds
To: John Pitera who wrote (18181)5/1/2016 12:20:24 PM
From: The Ox1 Recommendation  Read Replies (1) of 33421
 
Long term charts tell us what has taken place in the past, as well as what's going on right now. Taken alone, without other TA indicators, they rarely tell us what's going to happen in the future. Head fakes are common place. Pick out late 2005 on all 3 of bond charts in the SA portion of this post and tell me how they helped predict the movements during the next decade?
Yet the US economy continued to sputter along slowly and global weakness brought yields back down. In late 2015, the Fed was expected to raise rates as many as 6 times in the near-future. Then, a global collapse in commodity prices and rapidly slowing growth in China caused them to back-off again. Meanwhile, ten-year bonds have continued to hover around 2%.


Let's get real here. The FED clearly stated that they intend to move cautiously and slowly with respect to rising rates. Anyone in a 6 rate hike camp for 2016 was either talking their position or were being outright stupid.

In looking back at the first quarter of 2016, we've seen the US markets handle this initial raise but only just barely. I think caution going forward is justified but I'm not expecting a reversal by the FED.
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