- New Science in old markets -

New compressions break down in Europe, US notes. Indonesia extends

Several compressions formed in European stock indices yesterday that broke downward today. Here are Sweden, a German midcap index and Switzerland:

Europe stock comps

This has been quite a big 'break' so it is a little dangerous to sell the first two short right here - better to wait and see if we get a return movement back to those compressions soon. Try selling the Swiss market here though.

The ten-year US treasury note has also compressed in both price and yield and both have broken in the direction of lower prices:

ten yr comps

...which seems to be another chance to sell the longer end of the US curve (i.e. this futures contract and the thirty-year bonds too.)

Finally, one measure of the Indonesian stock market made a bottom extension yesterday, due no doubt to the enthusiasm with which the authorities there have been dispatching Australian passport holders. This is probably a 'special situation' that will have no longer-term economic effects at all. Buy Indonesia, if you have a way to do so:

Indonesia extends