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Inflation

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Alright followed my own rule of buying/selling on a double digit move and flogged some NRGU (some) today.
 
I give up..
Connect this morning: US market on fire;Dow Jones up 2.8% etc
Obviously my thoughts are... CPI vmust have been lower, the market expects an easing of rate rise or even not any more rise. .looking ahead you know..
Nope
CPI higher than expected..so we are supposed to be looking so far ahead as what? that the rate will rise, the economy will be smashed, many companies will disappear the fed will then restart QE and in 2050, the companirs will make huge profits in H2 and windmills economies with pink butterflies and newly discovered fairies flying in our new world cities?
Stunning and stunned.
I feel like retreating and moving out of the markets altogether to...where is the question
 
Went to bed after CPI expecting a 5% down move.... Looks like to reversed. Wtf is going on? Did the plunge protection team get activated?

Edit: just thought I'd add, the last time we had a day like this in US markets was mid July when the data was crap but the market headed into a bear rally. Perhaps we're witnessing the same? Still need to sort out the Gilts fiasco though
 
Last edited:
waterbottle said:
Headline improved and in a downtrend, core rising. Unemployment numbers rising.
Perhaps this is another hopium rally. Anyone brave enough to buy the dip?
Click to expand...
No brave heart here for significant amount.added index one put in November and bought back a few us shares i had list with SL.
SL today were not fun for a couple of my stocks as market initially fell heavily, sl triggered to see price jump a lot by close.was able to reenter the ones i wanted but at a cost.
 
The Streetlight Effect

"While a number of prices have fallen from their highs – iron ore, corn, shipping rates, used cars, copper and timber, to name a few – these tend to be prices we can easily track, that are in the market’s streetlight.

"It’s the prices that are more difficult to track through public data sets – food away from home, transportation services, medical services, shelter – that are proving stickiest, leading the market to consistently underestimate CPI.

"The common feature of these inflation hotspots is that they are mainly services sectors, which continue to feel the effect of wage growth created by America’s white-hot labour market...."

- Mervyn King
 
If futures had soared and then markets had soared at the open we'd be in total wtf territory but remember that everything plummeted at the open and then rebounded so it's not some kind of funny business - it's dip buying degenerates.

They turned green only AFTER plummeting deep into the red, not soaring premarket as soon as the data came out.
 
I agree with the wtf sentiment, totally irrational.
I'm reminded of the Keynes quote, "Markets can remain irrational longer than you can remain solvent."

Fantastic volatility for day trading but swing trading is impossible. Anticipating a Friday selloff.
I used to be indecisive but now I'm not sure.
 
Yeah i'm angling for another sell tonight. I sold 20% of my nrgu position last night.
 
I'd again point out that this is what happened in mid July when we had an epic rally despite worsening inflation and despite recession not even entering mainstream discussion.

The difference is this time we're fast approaching the terminal rate. We know inflation is trending down. Several markets have corrected, globally. Several businesses are already adjusting guidance.

So in that context, the dip buying may actually be true value....
 
Waiting to see what happens in the UK IMO.
ECB looks like it might kick QT down the road to early 2023.
US banks reporting tonight.
 
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