Now I am really glad that I shed all my index shorts and VIX longs yesterday.
Santa Claus will not be denied, and will be visiting bonuses on all the little girls and boys on Wall Street.
As by now I am sure you have heard, we had a ‘goldilocks’ jobs number today, good enough to ensure a Fed rate increase in December, or week after next to be more precise, but not so hot that the carefully set expectations of about 50 basis points, probably in a two step and then a pause, would be set aside.
This is likely to be a very slow, and very shallow rate hiking cycle. Why?
Because it is being done largely for policy purposes, a point which I have been nagging about for too long now. Unless something really changes, this is the worst excuse for a recovery one can imagine, if you are looking at the broad swath of the consuming public, and not the top five percent.
The geopolitical and exogenous risks remain elevated.
Let’s see if they can break this sucker out, up and away, which is what they would like to do, in a kind of a last hurrah. And the devil take the consequences, and the hindmost.
The SP 500 MUST set a higher high, then stick it and break out to activate the big double bottom or ‘W’ formation on the charts.
Have a pleasant weekend.