IS THE PAINT DRY YET?

That kind of day, in fact you might think it was summertime. MLPS are down a little as is the markets. Rates are up a little. And nat gas is spirialing down the abyss as it heads toward zero. MLPS themselves with only a couple of exceptions are fractionally either side of unchanged here at lunchtime.

There are some things however thay may be bubbling under the surface as we head into what could be a monetary weekend with the G-20 meeting in Korea.

If we look at these 2 charts of 10 year and 30 year yields it appears that we made some sort of short term bottom and there is room for some upside in rates. In fact the weekly chart of the 30 year has just gone to a buy on some of the technical indicators. It seems to me that the fed has made it clear it wants some inflation and its going to do whatever it takes to make it. That makes steeping the yield curve a priority and letting long rates rise. This would actually be a good thing as it would be a sign of the economy at least normalizing.

Now what of mlps. Many here have argued that going foward distribution hikes will offset any rise in yields on the long end and that may be true. However I continue to grow cautious in here as the group is ripe for some sort of pullback at least to moving average support. Right now thats from 330-340. Meanwhile nat gas just continues to fall as it heads for 3.00 and maybe a retest of the 2 handle we got to during the 2008 great unwind. Btw if the economy were really firing on all cylinders you would think nat gas would be rallying. But there is nothing out there for now which would pressures on what appears to be an endless supply.

TC Pipelines (TCLP) and Oneok (OKS) are down half about and are the biggest losers on the day. Winners showing gains of mostly under 30 cents.