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To: Rarebird who wrote (108431)	3/31/2018 3:44:24 PM
From: da_spot	Read Replies (1) \| Respond to of 116837

Rarebird, I'm inclined to keep seasonal trends in mind and agree with you about these upcoming weeks. I was just thinking of you and wanted to wish you

To: Rarebird who wrote (108431)	4/7/2018 10:15:42 AM
From: RetiredNow	Respond to of 116837

The next 2 weeks are extremely bullish in regard to money flows, due to massive inflows from IRA and 401K contributions. If the US stock market were to fall during this period of time, I would become an immediate believer in the Morgan Stanley thesis of QT you posted. - Rarebird 1 week down. SPY ended 263.15 in prior week and ended 259.70 on Friday, so we're down in the first week of April. Let's see how next week goes, but I'm thinking more of the same...sideways to down. But I'm also thinking that if the Fed makes good progress in April on the $50 in QT they need to do to stay on target ($20B behind schedule + $30B planned for April), then that is going to drop the AGG by $1-2 this month and the SPY may break below the 2,581 low, and thus, the 200 DMA, which could create some pretty serious selling pressure as we go into May. The only thing that might counteract those pressures may be traders waiting to see whether the SP500 has a good Q1 earnings season. Either way, I think April will be down and May will be even worse, as the "sell in May and go away" crowd gets positioned. The Fed has so far reduced its balance sheet by 91 billion. The biggest drawdown came between 2/14 and 2/28 when 41 billion vanished. The stock market correction started more than 2 weeks before that and ended before the big drawdown. I wonder if there was any connection or if news of the big reduction had leaked ahead of time. The big question, of course, is how long will it take before the tightening takes effect. - Rarebird I don't think it's a leak situation. The market already knows what the Fed schedule is. They've been very direct about what they will sell and when. I think the market has simply refused to believe that Powell will stick to his guns even in the face of a severe market downturn. The market believes the Yellen Put is still firmly in place. I think the opposite. Powell is going to rebuild is dry powder both on the interest rate increase side and the balance sheet reduction side. He has the political backdrop to do it too, since everyone wants to see Trump fail and Trump was very loud about how he's to credit for stock market gains. So if Powell punctures the market, the media will love that fact and the MSM news will pump out 24/7 tidbits about how Trump is to blame, which gives Powell all the air cover he needs, since the scapegoat is teed up for him. I think too many people are believing too much in an accommodative Fed when those days are already gone. Agree with you on inverted yield curve taking time to work into a recession. However, markets will move way in advance of recession, IMHO. Be careful out there. The spring is well wound now and when it gets sprung, it will be painful.

To: Rarebird who wrote (108431)	4/15/2018 2:35:36 PM
From: RetiredNow	Read Replies (1) \| Respond to of 116837

The next 2 weeks are extremely bullish in regard to money flows, due to massive inflows from IRA and 401K contributions. If the US stock market were to fall during this period of time, I would become an immediate believer in the Morgan Stanley thesis of QT you posted. - Rarebird 1 week down. SPY ended 263.15 in prior week and ended 259.70 on Friday, so we're down in the first week of April. Let's see how next week goes, but I'm thinking more of the same...sideways to down. - mindmeld Well, 2 weeks are done and here are the results from the S&P 500 Index: * March 29th Close = 2,640.87 * Week 1 End = 2,604.47, down 1.4% * Week 2 End = 2,656.30, up 2% on the week, up 0.5% over two weeks So kind of inconclusive over the last two weeks. If there was massive cash being invested over the last two weeks, the markets seem to have shrugged it off. During the same period of time, the Fed Balance Sheet only declined by about $8.5B. So that's only a small amount. Since the Fed Balance Sheet stands at $4,383,684B, it means they are going to have to backload their sales in the last two weeks of April with sales of about $43B in the next two weeks to hit their end of April target of $4,340,422B. If they manage that, then the next two weeks will be a bit harsh with bond yields widening and stocks moving down in sympathy.