This is an Intermarket Analysis chart review which graphically represent relationships (strong and weak) that can foretell how the undercurrents are moving to better identify where stocks/sectors/indices are flowing! You can see (and should see) my last Intermarket Chart Attack here.


There is a well-known expression among traders of  “The Fed Put” –  the market isn’t allowed to go down. This Fed rebalancing business and gradual Fed hiking may serve as “The Fed Call” – capping the advance. It’s been a tough first half of the year for indices. Is this the pause that refreshes?

Bullish Case: stocks are 150% of U.S. GDP. Put simply: our stock market is our economy and it is in the best interest of the White House and the Fed to support it!

Bearish Case: stocks are 150% of U.S. GDP. It’s not called the “everything bubble“ for nothing. Policy missteps can cause a pause (see first half results in indices this year), and even a reversion to the mean for Equities.

Perfect Storm for Market Pullback:

1. Real Trade Wars – that result in less trade, slower global and domestic growth, currency wars. China is not backing down – see the USD/CNH!
2. Inflation spikes (think scarcity of things – most scarce resource right now seems to be the USD). Fed tries to get ahead of this and that drives rate hikes causing debt servicing by corporations to contract profit margins, lowers access to debt financing for buybacks, puts HY bond holders on edge.
3. Credit leads Equities so HY bond market gets more than nervous especially since 25% short interest in Global HY ETFs is a record and corresponds w record fund outflows this yr.  If right, expect sharp blow out in credit spreads = Risk Off. Keep one eye firmly on price of Crude and with that Oil&Gas companies – as they constitute majority of the HY bond portfolio. On the other hand, HY could Short Squeeze in which would spreads would collapse.

Macro to Micro

SPY to $283 and QQQ to $183 seems a good Fib level to test/reverse. Case in point: The same NQ/NDX 61.8% extension off ’00/’02 bear for QQQ is $182.76.

Rate Watch Spike:

Most focus on yield curve flattening/inversion, but it is what happens next that really matters: Bull Steepening. I added some arrows to demonstrate – Worth noting: I see a $TYX spike happening soon (brief but impactful) that may help $TLT shorts cover. In trying to justify my TYX chart rate spike read,  I think I found one: US Q2 ’18 GDP is released 8:30am June 27. If it runs hot – like 4-5% crazy hot – rates can spike hard + give us that Bull Steepener Trial Balloon Test.

With that, TLT could easily move down into the $120 area so I’m talking brief but impactful rate spike ~EOM. Keep in mind, 10-year Treasury yields have traded in the narrowest range for a month in more than four decades. This is the definition of a squeeze if they cover.

Problem is we have RECORD short treasuries, record short HY and (once again) record short VXX — at the same time. Oh, and record long Oil.

Color me skeptical.


Here we are – presented without comment.

Banks may bounce with Rates as both are oversold.

An interest rate spike, especially in the short end of the curve, would alleviate some of the yield curve flattening, assuming the long end rises less slowly – which it usually does. This thesis would correspond with a TLT pullback at that resistance line – into the wedge from where I still expect it to explode higher later this year.

SPX resistance for the Rate-of-Change oscillator means above is bullish, below is bearish.

Nasdaq has fallen back and implies lower – potentially much lower from a false breakout of an asymmetrical triangle.

Small caps relative to SPX are also extended and due for a pullback.

Gold Miners are building up a lot of energy trying to decide which way to go. The first breakout is usually the fake one. I will enter long once my BPGDM index tags 35.

Wow, Bank of Japan and China are facing off to devalue their Currencies. Lower has not been good for Gold.

Big Picture: Gold is not bullish for more than a trade until FXY gets/stays back above $87.

Thanks for reading and please consider joining me in the LIVE Trading Room where we work through Value and Momentum trade ideas and set ups every trading day.


At LaDucTrading, Samantha LaDuc leads the analysis, education and trading services. She analyzes price patterns and inter-market relationships across stocks, commodities, currencies and interest rates; develops macro investment themes to identify tactical trading opportunities; and employs strategic technical analysis to deliver high conviction stock, sector and market calls. Through LIVE portfolio-tracking, across multiple time-frames, we offer real-time Trade Alerts via SMS/email that frame the Thesis, Triggers, Time Frames, Trade Set-ups and Option Tactics. Samantha excels in chart pattern recognition, volatility insight with some big-picture macro perspective thrown in.

More Macro:  @SamanthaLaDuc  Macro-to-Micro: @LaDucTrading