Monday, October 31, 2016

Buy Any Dip Today

We are likely going higher into the election.  The last minute jitters came in on Friday with the Hillary Clinton email news.  And of course, the media is apt to do, it overreacted, making a mountain out of a molehill.  This is old news, it doesn't change anyone's mind about either candidate.  The polls are pretty much telling us that it is Hillary Clinton who will win, and that hasn't changed.  Also, the FOMC meeting is coming up November 2, and the usual grind higher ahead of the FOMC is to be expected, especially since it is very likely to be a nothing burger.

Bonds look like we want 2.00% 10 year yields.  We are in the re-positioning phase for bonds, as there have been a lot of inflows into bond funds and ETFs this year, with the move down in oil and with all the deflation talk and Brexit fears, etc.  Now we have a lot of revival of inflation talk and expectations for ECB tapering and Fed rate hikes.  The tide has turned on the money flows, and it should last for a few months.  I don't want to get in the way of that wave.  Even though I am a long term bull on bonds, I do see an intermediate term move higher in yields from now till early 2017.

The volatility is really dying out there, hoping for one more little dip lower to scoop up some S&P today.  Any prices around Friday's lows of S&P 2120 area is a buy.

1 comment:

MM111 said...

2120 still a buy?