12/20/2017 A disconnect between stocks, bonds and currencies is raising a flag

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TRADING NATION VIDEOS TRADER BIOS COMMENTARY

Strange disconnect in the

market is raising a red flag for
one market watcher
Rebecca Ungarino | @ungarino
Published 7 Hours Ago | Updated 3 Hours Ago

TRADING NATION

Apple could ring in the New Year with $1

trillion market cap

There’s something in the chart that tells

me oil is about to surge: Trader
With an overbought stock market,

  here's why you should watch other

assets
5 Hours Ago | 01:23
Strange disconnect in the market is
raising a red flag for one market watcher

 A disconnect between different markets as tax

reform legislation nears passage has one
strategist concerned.

A disconnect between equities, bonds and the currency market as tax
reform legislation nears passage has one equity strategist concerned.
Rising inflation could trigger a 'mini
 panic,' warns longtime bull Jim Paulsen
The S&P 500 has rallied to record highs as investors price in hopes of A longtime bull is predicting it'll be difficult to

corporate tax cuts, but the Treasury market and U.S. dollar are not ward off a deep sell-off next year.

behaving in a similarly bullish manner, said Matt Maley, equity strategist

at Miller Tabak. This, along with the stock market's overbought
condition, will be of concern in the beginning of 2018, and he has three
charts to back up his cautious view. Here's why.
• The S&P is quite overbought on a near-term basis, as its weekly
relative strength index is at its most overbought in history. This
indicates the market may be ripe for a "sell the news" reaction to the
sweeping tax bill, should it pass.
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VIDEOS ›

Major market indexes close lower;

House to vote again on tax bill due
• Meanwhile, the bond market as measured by the iShares 20+ Year  to procedural snag
Treasury Bond exchange-traded fund (TLT) has traded in a sideways This Tuesday, eight out of 11 sectors end the
session lower.
range for months.

https://www.cnbc.com/2017/12/19/a-disconnect-between-stocks-bonds-and-currencies-is-raising-a-flag.html 1/3
12/20/2017 A disconnect between stocks, bonds and currencies is raising a flag
With an overbought stock market,
here's why you should watch other
 assets
Matt Maley of Miller Tabak says investors
should be watching other markets just as
much as they're eyeing the stock market.

Trader sees a bounce ahead for oil

Todd Gordon of TradingAnalysis.com is betting
 on a rally for crude.

TRADER BIOS ›

Stacey Gilbert
Stacey Gilbert is the head of derivative
strategy at Susquehanna.
• The U.S. dollar index, too, has moved in a similarly narrow range
rather than rallying on the prospect of economic growth and higher
interest rates. Lawrence McDonald
Managing Director, ACG Analytics

Rich Ross
Managing Director, Head of Technical Analysis,
Evercore ISI

MOST POPULAR

Families will feel the

1. pain of losing this tax
 break in GOP plan


NYSE files to list

• This disconnect between various asset classes is raising the question 2. bitcoin ETFs,
of whether the tax reform bill is truly going to have a major bearing on
bringing

the economy. While the stock market is saying yes, the other markets cryptocurrency a
are saying perhaps not so much. step closer to
 mainstream
Bottom line: While stocks have rallied to all-time highs on tax reform-
related optimism, bonds and the U.S. dollar have not reacted in a Chipotle shares drop
similar fashion. This raises the question of the kind of economic impact
3. on yet another report
the bill could have. of possible food
safety issues
Will the stock market rally continue in 2018?
Officials won't let a
Yes 4. man look for $127
No million in bitcoin he
threw away
VOTE Vote to see results

How tax reform will

5. end the nonprofit
Rebecca Ungarino
Associate Producer executive pay scam

RELATED SECURITIES

Symbol Price Change %Change

S&P 500 2680.97 -0.50 -0.02%

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