Yield In CPI-Induced Plunge, While IWM Surges

Benchmark 10-Year YIELD and IWM (Small Cap ETF)-- We discussed this possibility late yesterday. That is, a CPI-induced plunge in YIELD that propels IWM (Small Cap ETF) higher in anticipation of lower rates and a better environment for small companies to borrow money. So far, this AM's reaction to CPI is perpetuating such a scenario.

My attached Daily Chart of 10-year YIELD shows the nosedive to test and marginal breach the June low at 4.19% (this AM's low is 4.18%) which positions YIELD for further deterioration toward 4.00%. 

Meanwhile, my attached 4-Hour IWM chart shows the price structure surging toward a confrontation with a 3-1/2 month resistance line that cuts across the price axis in the vicinity of 209.00 this AM that if hurdled and sustained, will greatly increase the likelihood of upside continuation and acceleration to take out the April high at 212.15... 

Let's be aware of the Advance/Decline data today. At the moment, after 20 minutes of trading, Adv Issues = 2303 vs. Declining Issues = 405, which represents a positive ratio of 5.7 to 1, and is a BIG expansion of positive breadth (broadening participation into non-big technology sectors and names) that IF SUSTAINED will be a major factor in prolonging the equity bull move... 


  Matched
x
  • In our live, interactive Trading Room, we identify trading opportunities in ...
  • Equity Index Futures
  • Index & Sector ETFs
  • Individual Stocks
  • Precious Metals
  • Energy
  • Forex
  • Treasuries
  • International Markets
  • And Much More
Join MPTrader Now!
Veteran Wall Street analyst and financial author, Mike provides detailed and timely analysis and trade set-ups on a range of markets. Read more...

Have Mike's “Out Front” morning analysis delivered FREE to your email inbox twice weekly!