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4/20 Mid-day Blog

30 min to go.. We've seen breadth expand to more negative in the last couple hours.. From 2/1 to near 3/1 while Volume also near the same level into DOWN v UP stocks.. We started out today with 2 sectors down more than 1%.. Now we have 4-    Staples, Tech, Discretionary and Utilities-  key to note .  US 10yr TY has sold off sufficiently to make new lows for the year.. I.e. YIELDS are now up above 2.95 which marked Feb peaks.. So we're within striking distance now of highest levels in 10yr yields since late Dec 2013.. When we closed at 3.028 and early Jan saw intra-day 3.05 before reversing.. So I think this is the key level for 10yr yields. And a few counter-trend indicators suggest yields might hold 3.05 and not immediately go to 3.25%, particularly with levels of SPEC shorts in TY based on CFTC Non-commercial futs-   US Dollar meanwhile has made progress higher.. So combination of rising yields and USD is near-term bearish For Metals.. And we're seeing some backing off of earlier week gains for the Metals trade-  Sector wise, 5 of the worst 10 of Discretionary are all within the Retail space.. And this area still looks ripe to AVOID.. With breakdowns in GPS, BBBY, KSS, MAT, LB, RL.. Of these.. I like shorting BBBY and GPS.. But others are a bit extended and/or closer to support-  and/or just short XRT which is good liquid vehicle