© 2012 ROHR International, Inc. All International rights reserved.

Just as we noted in yesterday's courtesy access to our TrendView Brief Update assessment of the two major trend ‘haven’ psychology shifts, the major weakness that has affected the previously ‘Teflon’ govvies was based upon very solid, classical intermarket influences also apparent during previous major trend reversals for bond markets. We encourage anyone who has not already read the extended discussion to link into that analysis from yesterday's post. It is classic macro-technical intermarket psychology taking hold of an asset class that had stayed too long at the ball.

The other significant consideration now that the trend reversal in govvies has seen the initial downward shockwave is whether there is any primary government bond market relief rally in sight, or the aggressive downtrend is going to continue in right into the end of this week. That typically leads to spillover into early next week as well. The issue is whether govvies prices can stabilize without knocking out some key supports, below which there is not much for quite some distance.

The operative factor is likely to be the equity market decision against interim resistance as we head into the weekly Close…  especially as the March S&P 500 future expiration today leaves the modestly discounted (six dollars) June contract as the lead futures contract for the weekly close tomorrow. Interesting, and possibly just a bit of an edge for the equities bears and govvies bulls, that it should be right around a significant psychological and technical level like 1,400 just as the June S&P 500 future remains below it after the March contract breached it today…

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© 2012 ROHR International, Inc. All International rights reserved.

Short & Sweet on the specific market comments in this post, because today’s TrendView Brief Update was such an extended discussion of the two major trend ‘haven’ psychology shifts it is not possible to condense it into a concise blog post. We are of course referring to the major weakness that has affected the previously ‘Teflon’ govvies.  That is not as surprising as it might appear in the wake of the US equities more convincing escape above last summer's highs; and especially the June S&P 500 future UP acceleration once it managed to finally sustain activity above 1,367-69 current and historic resistance. This is classic macro-technical psychology.

The other significant change has been the role reversal for the US dollar, which had previous been the ‘haven’ in foreign exchange only when crises elsewhere upset investors; and commensurately suffered during "risk on" psychologies elevating values of other asset classes and currencies. Well, that is also reversed now, even though the Fed is maintaining its endless sea of liquidity easy money policy. However, previous folks were taking ‘free’ money from the Fed and shipping it out to other global centers that were more propitious, or shoving it into attractive ‘risk on’ commodity trades to avoid putting it into the poor, old, sickly US economy.

Lo and behold, along the way problems in Europe that backed up into Asia meant…

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© 2012 ROHR International, Inc. All International rights reserved.

Our full Color-Coded Calendar is still available through the link in the right hand column along with the Technical Projections and Select Comments that all point out some interesting horizons. That both information and price are in play as the trends advance later this week is no surprise in a macro-technical environment that is driven by the US strength in the face of much spottier news and performance elsewhere.

And as a further improvement in our information, the Weekly Report & Event Calendar has been significantly upgraded. It now is not just color coded for the different classes of influences, but also estimates and previous release data (where applicable) have been added. We have also added the US Eastern time zone to the Greenwich Mean Time which was on the calendar previous.

And in addition to all that…

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© 2012 ROHR International, Inc. All International rights reserved.

There have been combined recent constructive influences from the Greek Debt Deal PSI negotiation ending up with a high level of participation (even if the Greek government Collective Action Clauses needed to be triggered) and another round of upbeat US Employment numbers into today. Even allowing that the international economic data is not quite as upbeat as the US right now, it is reasonable that the March S&P 500 future should escape key resistance at 1,367-69. The only dilemma with all that is why the other asset classes are not performing in their classical manner? And some are even throwing off signals that would seem to run counter to the idea further extensive US economic strength will be forthcoming.

We are of course referring to the degree to which the primary government bond markets have taken the further extension of the equities rally from Tuesday's low by not selling off much and all (and the German Bund future is actually higher.) Similarly in foreign exchange, the US Dollar Index is strengthening nicely back above its .7950-25 previously violated support. And along with Australian dollar and Japanese yen weakness against the greenback, that is substantially based on the (heavily weighted) euro sliding even further from key resistances at EUR/USD 1.3460-1.3500 (from last week) and the 1.3360 area. Next support there might be is nearby as the 1.3050 area, but the overall trend momentum feels pretty negative.

So, what's up with all that?

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