To The Moon

On Thursday night, the price of gold continued to hit a record high, which indicated that the market fully expected to cut interest rates. However, when the market fully expects, Federal Reserve Chairman Powell will come out and pour cold water on the market.

After all, expectation management is one of the important tasks of the Federal Reserve, so no matter what he says, the key depends on how the Fed does its follow-up actions. Even if the interest rate cut is really delayed, it is only an adjustment to re-hype the interest rate cut expectation. The market does not think that you will really exceed expectations, unless this week's non-farm data can exceed expectations, which may bring some adjustments to asset prices.

First, pay attention to the strength and weakness of the US stock index

Since the U.S. stocks rose all the way at the end of last year, last week, for the first time, there was a strong and weak differentiation among different indexes, which deserves everyone's attention.

Generally speaking, the technology leader Nasdaq is stronger than the Russell 2000 index of small-cap stocks. However, last Monday, the Nasdaq did not hit a new high, but also fell slightly, while the Russell 2000 index of small-cap stocks hit a new high in the near future, which means that the US stock market may enter a laggard rising market from this stage.

Which refers to the time when leading stocks don't rise much (of course, they don't fall much), while small and medium-sized stocks take turns to be strong, and the appearance of this kind of market is often the end of the stage market (usually lasts for 2-3 weeks). Therefore, if Russell 2000 continues to be strong and Nasdaq fluctuates at a high level in the following weeks, the probability of major market adjustment will increase, and corresponding preparations need to be made.

Second, oil prices continue to be strong

After crude oil broke through 80, 80 became its phased support position. Although it is believed that the current oil price is still in a dawdling state, the gradual rise of the bottom has been clear.

The next stage is to see how the oil price is tossed in the 80-90 range. The OPEC + meeting at the beginning of next month will see if there are any new news points. If not, it can only wait until the policy after Saudi Arabia voluntarily reduces production in June. If Saudi Arabia gives up voluntary production reduction, it will be a certain degree of bad for oil prices, but it is estimated that the probability will not be too high.

Moreover, the conflict between Russia and Ukraine is still going on. Ukraine destroyed an oil refinery in Russia with drones a while ago, which accounted for 11% of Russia's refined oil production capacity, which also passively forced Russia to reduce its crude oil production (it is impossible to refine oil when it comes to output, so it is better to reduce production conveniently). Therefore, unless there is a large increase in crude oil production at present, there are still many positive factors on the supply side. Technically, the 20-day moving average tracking is still effective. If the bulls don't break, they will take it first, and if they fall below $80, they will withdraw (at the 20-day moving average).

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