All the models have been updated, the algorithmic signals tracked and accounted for, and there is little to suggests a change coming for the markets. Instead the research suggests a continued drift of the calm and upward variety.
We have an FOMC rate decision Wednesday afternoon, but 97% of participants are priced for no change. Almost everyone is certain, through all the Fed-speak, that the FOMC is a predicable organization. Pair that with a decent start to earnings season and you have little reason for change.
The last week of July looks like another snooze-fest, perhaps best suited for chasing the narrowing pockets of momentum that are likely to show up, if only for overnight holds.
I may have jumped the gun late last week with my shorts. I do not believe in Starbucks and their China campaign. It is bound to fail as frauds and gross water taint their brand. So I shorted SBUX into earnings which is so far a losing proposition. I also took a position in the triple-lindy-inverse China ETF YANG. Both of these positions are subject to liquidation next week, given the model signals being generated.
As always, TBD.
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