Monday, March 09, 2020

Market Fear Reaches A Level Seen Only 4 Times Since 2008 / Stock-Markets / Financial Markets 2020

By: Chris_Vermeulen

Since 2009 the stock market has had for major waves of investor fear (volatility) take place which was in 2010, 2011, 2015, and 2018. Each time the market corrected we saw a drop anywhere from 12% – 18% and both traders and investors became emotional and started selling assets in fear of lower prices. What we are experiencing right now is the same sort of setup once again.

These waves of panic selling are a signature pattern of a mini-crash and they have similar outcomes each time which I will share with you here so you know what to expect and how to trade this rare market condition.

It takes a lot to convince the masses to reach this level of fear. Each of these mini-market crashes there has been some catalysts to further induce fear/selling. This time its Covid-19 that is tipping the scales.

Only two assets have acted as a safe haven which is bonds, and gold. Once again everyone has been piling into these over the past week, and even more so on Friday with Bonds surging 6.5% at one point during the session.

Monday, March 09, 2020

Have We Seen The Peak In The Stock Market VIX? / Stock-Markets / Volatility

By: Chris_Vermeulen

The recent price breakdown in the US stock market (near the end of February 2020) prompted a very big spike in the VIX – could we see another HUGE spike with a deeper price selloff in the near future?

Our researchers believe this first downside price rotation in the US stock market may be just the first downside move in what may become a “waterfall” price event where price declines in a series of downside price waves reaching an ultimate support level.  The way the VIX works is to attempt to normalize implied volatility based on available options call and put data over a 30-day span.  The process of normalizing this data attempt to eradicate outlier data from the equation.  Thus, a VIX level of 40 has likely resulted in completed data that attempts to eliminate outlier data points that may have resulted in a much higher VIX value.

After this recent rally in the VIX level, the current normalization process will likely take the current range of the VIX (options data) into consideration for future VIX levels.  Thus, in order for the VIX to reach levels above 40 again, a much bigger downside price move would have to take place – possibly pushing the SPY to levels near $260 or lower.  A move like this would have to happen in an aggressive type of price decline in order for the VIX to rally back above 40.  Is this something we should expect in the near future?

Sunday, March 08, 2020

Dow Stock Market Crash Watch / Stock-Markets / Stock Markets 2020

By: readtheticker

This is now on the table. Let us review three prior Dow volatility shocks. But first let us remind you of the Sabbatical Cycle (previous post Shemitah Study)  Re post of the 7 year cycle chart below. Take 2015 add on 7 equals 2022, which suggests if a bear market does a occur a low maybe found in 2022. In 2015 we had a 12% sell off just prior to the 2016 US elections. 

Sunday, March 08, 2020

Coronavirus Infects US Dollar / Currencies / US Dollar

By: Richard_Mills

Up to a month ago the US dollar was showing resilience in the face of a slowdown in the global economy evidenced by anemic growth. As central banks including the US Federal Reserve reacted by lowering interest rates, it looked as though strength in the US economy (stock market bull, 50-year-low unemployment, etc.) would see the States through the downturn, especially since US Treasury yields were that much higher than those of competing bonds such as the German “bund”. 

All that has changed with the coronavirus. 

Sunday, March 08, 2020

Iran Is Not Hyperinflating / Economics / HyperInflation

By: Steve_H_Hanke

Each and every day we read that Iran is hyperinflating or about to hyperinflate. The same is written about Zimbabwe and Venezuela, as well as a potpourri of other countries that are experiencing inflation flare-ups. While Iran came close to hyperinflating in the fall of 2012, it has never experienced an episode of hyperinflation. And while Zimbabwe experienced episodes of hyperinflation in 2007–08 and in 2017, it is not experiencing one now. At present, Venezuela is the only country experiencing hyperinflation.

It’s clear that journalists and those they interview tend to play fast and loose with the word “hyperinflation.” To clean up the hyperinflation landscape, we must define the word. So, just what is the definition of the oft-misused word “hyperinflation?” The convention adopted in the scientific literature is to classify an inflation as a hyperinflation if the monthly inflation rate exceeds 50 percent. This definition was adopted in 1956, after Phillip Cagan published his seminal analysis of hyperinflation, which appeared in a book edited by Milton Friedman, Studies in the Quantity Theory of Money.

Sunday, March 08, 2020

UK Coronavirus PANIC Buying Begins! Empty Supermarket Shelves of Toilet Rolls and Hand Sanitisers / Politics / Pandemic

By: N_Walayat

UK panic buying that began mid last week has continued to accelerate during the weekend, with shoppers spending the weekend busy stripping supermarket shelves bare as the number of coronavirus infections starts to go parabolic, which has claimed its first UK deaths as the total number of cases across the UK jumps to over 276. The Department of Health confirmed the deadly bug is spreading at its fastest rate yet as over 60 people testing positive on Saturday 24 hours.

Here we go on an a preppers style shopping trip to our local Tesco supermarket in Sheffield to stock up in advance of the looming Coronavirus storm only to find many shelves had already been stripped bare, and it is unlikely that Supermarkets have enough stocks to meet demands for many items such as hand sanitisers and toilet rolls and pasta, anything basically with a long shelf life.

Sunday, March 08, 2020

UK CORONAVIRUS WARNING - All Schools to Close Next Week for 6 Months! / Politics / Pandemic

By: N_Walayat

Here is a reminder of our expectations that ALL UK schools could close by the end of next week as the the calm before the storm stage is now over as the UK sees the number of infections start to go parabolic, likely to pass 300 today (Sunday). My forecast of 14th Feb 2020 concluded in the infected to trend to 5000 by the end of March resulting in 90 deaths. Analysis of what is happening in South Korea illustrates that outbreaks tend to be explosive, soon jumping from 1 to 1000 infected in a matter of days, which is likely the pattern to expect in the UK, that I am sure will prompt emergency, even panic response such as cancellation of virtually all public events, schools, universities and colleges being closed, and infected hot spots being quarantined, all likely to start taking place by Mid March, as I first warned to expect to happen over 3 weeks ago. And that Britain's schools could remain close for 6 months until September!

So watch the video so that we are all prepared for when the inevitable outbreaks start taking place across all of Britain's major cities, Birmingham, Manchester, Sheffield, London, Leeds etc.

Saturday, March 07, 2020

Coronavirus Straightforward Calculations on COVID-19 Risks / Politics / Pandemic

By: Submissions

Daniel Nevins writes: As recently as two weeks ago, it wasn’t clear which infectious disease experts had the best handle on COVID-19’s likely path.

Among the optimists, one operation ran a model in February that showed the following maximum case counts by the “end of the epidemic.” (I’ve included the running case tally as well, using data from the Johns Hopkins dashboard.)

Saturday, March 07, 2020

Markets Ignore FED Rate Cut: SPX Could Break 2600 with Force / Stock-Markets / Stock Markets 2020

By: Mehabe

Dow Jones closes down almost 800 points, as investors worried the Fed's emergency cut won’t be enough to combat the economic impact of the coronavirus. US 10y yield drops <1% for first time.

Saturday, March 07, 2020

How Deadly is the Coronavirus? Case Fatality Rate (CFR) Analysis / Politics / Pandemic

By: Nadeem_Walayat

This is part 1 of 2 of my latest analysis that seeks to convert the unfolding Coronavirus Pandemic into a stock market trend forecast, a pandemic that increasingly looks likely to be the worst the world has faced since the 1918 Spanish flu that killed an estimated 10% of the world's population. Thankfully, so far this virus looks set kill less than 1/10th that of the Spanish flu, still extremely deadly that the markets are NOT fully discounting the consequences of and that the virus could mutate into an even deadlier strain that it has already done at least once to date ( S type into L type).

Just how deadly is the Coronavirus? For the answer to that we look to the case fatality rate across a number of infected countries with differing capabilities in their ability to test for infections and then to compare against the conclusion of my analysis of 21st February that took into account serious under reporting in the numbers infected in China, probably to a magnitude of at least X7 that concluded in a probable Coronavirus case fatality rate of 0.64% which if accurate would make the Covid-19 about 15 times as deadly as the seasonal flu.

Saturday, March 07, 2020

UK Coronavirus Panic Buying, Empty Supermarket Shelves - Preppers Tesco Shopping Trip Sheffield / Politics / Pandemic

By: N_Walayat

Britian's more clued in shoppers have been busy stripping supermarket shelves bare as the number of coronavirus infections starts to go parabolic, which has claimed its first UK death. A second coronavirus victim is feared to have died at a hospital in Milton Keynes as the total number of cases across the UK jumps to 163. The Department of Health confirmed the deadly bug is spreading at its fastest rate yet as a total of 47 people tested positive in the last 24 hours.

Here we go on an a preppers style shopping trip to our local Tesco supermarket in Sheffield to stock up in advance of the looming Coronavirus storm only to find many shelves have already been stripped bare, and it is unlikely that Supermarkets have enough stocks to meet demands for many items such as hand sanitisers.

Saturday, March 07, 2020

Coronavirus Best Vitamins for COVID-19 Protection, Top Immune System Boosters / Personal_Finance / Health and Fitness

By: HGR

While there are several different things that can be done to help prevent contamination spread , such as wearing Personal Protection Equipment (PPE), like a ParticleMax P3 Virus Filter in combination with a Gas Mask (e.g., MIRA Safety CM-6M), it is also good to ensure that your body’s immune system in boosted to help fight off an infection. Immune system supplements ensure that you have no compromising vitamin deficiencies in your immune system function. The following video will list out my Top immune system supplements for helping fight off a virus from infecting your body.

Saturday, March 07, 2020

Gold and Silver Rally Back After Fed Emergency Interest Rate Cut / Commodities / Gold & Silver 2020

By: Chris_Vermeulen

Over the past few weeks and months, our research team has continued to sing the praises of precious metals – particularly Gold and Silver.  After last week’s dramatic selloff in precious metals (attributed mostly to margin call sales), both Gold and Silver rallied almost 3% on Tuesday, March 3 – the day the US Fed issued an emergency 0.50% rate cut.

We believe this move by the US Fed solidified a fear in the global markets that the central banks are preparing for a much broader economic contraction and attempting to front-run weakness by moving price rates lower.  This will help to ease capital restrictions, liquidity across global markets and spur some global borrowing at a time when the Coronavirus may continue to weigh on global economies.  Still, for skilled metals traders, this is likely the rocket fuel we need to see Gold rally above $1800 very quickly and for Silver to rally above $21 quickly as well.

Saturday, March 07, 2020

Think the Fed's Emergency Interest Rate Cut is Proactive? Think Again / Interest-Rates / US Interest Rates

By: EWI

You might think that the Fed's recent, unscheduled 50 basis-point cut in the federal funds rate is a proactive move that places the central bank at the vanguard of revolutionary uses of monetary policy. But that could hardly be further from the truth.

For decades at Elliott Wave International, we've observed that the Fed simply follows the yield on short-term government debt. We say that "the Fed follows the market" because the freely traded bond market determines the yield on government debt. The yield on short-term U.S. Treasuries started falling in earnest in February, and in March the Fed aligned its target rate with the trend of the market. There's nothing radical or revolutionary about it. The Fed merely followed the market yet again. This chart shows the recent history.

Friday, March 06, 2020

Gold Is the Strongest Currency Since the Coronavirus Scare / Commodities / Gold & Silver 2020

By: MoneyMetals

Another tumultuous week in equity and interest rate markets has helped fuel a big pop in safe-haven demand for gold and silver.

The major market moving event was, of course, the Federal Reserve’s emergency rate cut on Tuesday. The Fed slashed its overnight funds rate by 50 basis points. But even before the Fed acted, the bond market had already forced its hand as yields on the 10-year Treasury note plunged to record low levels.

By Friday morning, the 10-year treasury yielded less than a paltry 0.90%. That represents almost no reward in exchange for the risk involved. Bond buyers are apparently willing to make a decade-long bet on U.S. government finances remaining solid and inflation remaining extremely low.

It’s still possible for bonds to experience capital appreciation if rates ultimately head to zero or below – as they have already done in other parts of the world. The Fed is almost certain to cut rates again. There is a good chance at least some portion of the yield curve will be at zero later in the year.

Friday, March 06, 2020

How Deadly is the Coronavirus - Case Fatality Rate (CFR) Analysis / Politics / Pandemic

By: Nadeem_Walayat

This is part 1 of 2 of my latest analysis that seeks to convert the unfolding Coronavirus Pandemic into a stock market trend forecast, a pandemic that increasingly looks likely to be the worst the world has faced since the 1918 Spanish flu that killed an estimated 10% of the world's population. Thankfully, so far this virus looks set kill less than 1/10th that of the Spanish flu, still extremely deadly that the markets are NOT fully discounting the consequences of and that the virus could mutate into an even deadlier strain that it has already done at least once to date ( S type into L type).

Just how deadly is the Coronavirus? For the answer to that we look to the case fatality rate across a number of infected countries with differing capabilities in their ability to test for infections and then to compare against the conclusion of my analysis of 21st February that took into account serious under reporting in the numbers infected in China, probably to a magnitude of at least X7 that concluded in a probable Coronavirus case fatality rate of 0.64% which if accurate would make the Covid-19 about 15 times as deadly as the seasonal flu.

Friday, March 06, 2020

US Fed Panics – Stock Market Predictive Modeling Shows You What’s Next / Stock-Markets / Stock Markets 2020

By: Chris_Vermeulen

March 3, 2020: the US Fed issued an emergency rate cut of 0.50% to move rates to levels near 1.0% as a result of global economic concerns related to the spread of the Coronavirus and the potential damage it may do to the global major economies.  President Trump had been suggesting the US Fed needed to be ahead of the risks associated with future market expectations to allow for increased liquidity and global economic function.  Yet, we believe this move by the US Fed came at the wrong time for most investors and traders.

The global markets had already begun a process of revaluing risk in the markets near the end of February 2020.  After the Q1 earnings data was digested and the newest Chinese data became available, investors suddenly understood the risks that we had been warning about for most of January and February.  Suddenly, the US markets collapsed and traders were revaluing forward expectations.

Friday, March 06, 2020

Fed Panics over Coronavirus. What’s Next for Gold? / Commodities / Gold & Silver 2020

By: Arkadiusz_Sieron

Yesterday, the Fed cut interest rates by 50 basis points. Not during a regular monetary policy meeting, but in a surprising move. But what are the implications for the gold market specifically?

Fed Cuts Interest Rates in Emergency Move

Last week, I wrote that the spread of the new coronavirus to Europe and the inversion of the yield curve make “the Fed more likely to step in and cut the federal funds rate, you know, “just in case”. And in yesterday’s surprise move, the Federal Reserve cut the federal funds rate by 50 basis points in response to the coronavirus threat. The decision was unanimous and it was communicated in the FOMC statement as follows:

Thursday, March 05, 2020

Fed Coronavirus Reaction Was Not What Most Expected / Stock-Markets / Financial Markets 2020

By: Avi_Gilburt

Early Tuesday morning, I put out an update to our members of ElliottWaveTrader.net that noted that the 3135 region as the top of our resistance region, which can point us lower once struck.

Now, we all know that the “surprise” rate cut by the Fed should have been viewed as a positive to the market. In fact, most expected the Fed to act soon, and were certain how this would send the market soaring again.

However, I continue to reiterate that when the market is in a positive sentiment trend, the Fed action will always be viewed as positive. Yet, when the market is in a negative sentiment trend, the Fed will not likely be able to stem the tide of negative sentiment. They simply cannot change the sentiment of the market, despite the common misconception to the contrary.

Thursday, March 05, 2020

See Market Opportunities in the Coronavirus Chaos - Here's How / Stock-Markets / Stock Markets 2020

By: EWI

Dear Reader,

The Fed has cut rates, but stocks barely noticed. And you may be getting particularly worried right now.

Our friends at Elliott Wave International would like to help -- free.

Their research shows that -- contrary to what everyone else thinks right now -- China's recent epidemic outbreaks have marked market bottoms, not tops.

In fact, they've just put together a free, on-demand webinar "Coronavirus: Opportunities in the Chaos" shows you the full evidence.