Mel's Blog

It's Friday the 13th, but Bonds are getting lucky off a boost from this morning's weak Retail Sales report.  Well below expectations, Retail Sales plunged -0.9% in June, the lowest level reported since August 2005.  Additionally, previous numbers for April and May were also revised lower.  This weak reading hit the market as a bit of a surprise following yesterday's strong numbers from WalMart, especially because it is said in the pits "As goes WalMart, so goes Retail"...so Traders were expecting a much healthier number, and the surprising news has helped Bonds move higher this morning.  

Yet in other news, the University of Michigan ’s Preliminary Consumer Sentiment Index for July was reported at a blistering 92.4, far higher than expectations of 85.5.  So although the consumer apparently didn't get out and spend their money as expected in June, it appears that the consumer is overall feeling confident and positive about their own personal economic outlook ahead.    

But the positive consumer outlook - and the ceiling at the 25-day Moving Average - might just stop this morning's upward momentum for Bonds right in its tracks.  In fact, look at the Bond Page - it's pretty amazing to see this morning's gains stop exactly at the 25-day MA like it has several times of late.  So for now, we can Float very cautiously as we watch Bonds battle the 25-day Moving Average - but we wouldn't be surprised if Bonds are pushed lower resulting in a lock position again this afternoon.