Daily Treasury Statement Charts Update: 10/3/11 – The Mystery Continues…
An update of the daily treasury statement charts: – The Mysterious leading indicator continues to perform…
It was a rough day in the markets (for most people); the dollar appreciated versus equities, commodities and most currencies. The total operating balance of the US Treasury continued down yesterday (latest), declining by $8 billion. The market continues to corroborate the thesis that heavy expenditures are bullish for risk assets and accumulations of cash are bearish.
If markets are to remain this weak for a while, it is likely that the US Treasury will surprise itself by how much it ‘needs’ to withdraw from its coffers. This could bring the foxing ‘crack-up’ move that precedes a more profound downward leg. I now present the total operating balance with some risk assets lagged ~40 trading days; the charts suggest that the ‘crack-up’ move could begin in around 15-16 trading days:
[Again - let me warn you that this may be regarded as a form of alchemy!]
Note: the auctioneer stocks remain weak today. My theory on why they lead the market at tops and bottoms is here.
Recommended: Charting the Federal Reserve's Assets - 1915 to 2012