Please enable javascript in your browser to view this site!

Dollar, Treasury yields reverse early weakness while Europe closes up 2%

Just past Europe's close, we've seen an acceleration in European equities with SXXP, SX5E lifting to the highest levels since late May.  Early weakness in both Treasury yields and US Dollar were both reversed, and now 10yr yields are on the verge of challenging last week's highs, which if broken, (1.63) would represent a breakout of the entire downtrend for this year.  Dollar/Yen IS in fact exceeding this downtrend as of intra-day, which looks important and bullish.  So despite the lackluster Jobs report-  which missed expectations, yet most of this are are slanted toward the least educated workers ( Age 25+ HighSchool degree or less +293k, Some college -212k, Bachelor’s -123k.)

JPY chart below showing US Dollar breaking out vs Yen, as flight to risk assets occurs, and the Yen is sold-  this must make the BOJ happy, but is more based on a lack of demand for risk-aversion Yen than based on any real policies

With regards to US.. we're seeing sharp gains in both Energy , Materials and Consumer Staples, but a fairly broad based rally at 4.5/1 positive and all 10 sectors positive, while Healthcare is lagging.  Today's move is seen as bullish and generally should lead higher on a close over this 2176 area which had held the trend intact from mid- August-  Overall, a push back up to 2191 should happen in the days ahead, above leading to a lift above 2200 to 2210-15 before any peak-  S&P Futures show this recent range, and is illustrated below