Retreat, Then Re-Engage

The day-to-day, heck, even the intraday and especially overnight, randomness of these price swings and headline sensitivity reinforces a concept which those who have followed my work for years have come to learn: A heavy cash position is a particularly powerful one in these sorts of markets. 

As quantitative easing officially ends today, The Fed exits its legendary bond buying program before presumably raising rates at the FOMC one week from today. Tomorrow morning's CPI data point figures to be a market mover, too.

However, this morning the market is rejoicing over the prospect of diplomacy between Ukraine and Russia. Gold, wheat, and especially oil are coming in hard, allowing equities room to squeeze. 

As of now, I am not in a rush to throw on a bunch of shorts and fade the bounce, although towards the end of the day that can change. Still, looking at a major name like Boeing (BA), below on its daily chart, I cannot help but think it is merely setting back up as a quality swing short setup after recently breaking to multi-year lows below well-defined support in the context of a strong downtrend. 

Regarding the end of QE, without The Fed playing the big bad Wolf in the bond market now and distorting price discovery, my expectation is that rates are headed much higher.