Even though Chair Powell said it is far too early to declare victory, he and his team did exactly that yesterday when they caught markets by surprise by making a hard dovish turn. The dot plot now expects up to … Continued
Following futures positions of non-commercials are as of December 5, 2023. 10-year note: Currently net short 636.5k, down 48.9k. The FOMC meets next Tuesday-Wednesday. This will be the year’s last meeting. They are expected to do nothing. The last hike … Continued
More evidence came out this week that the labor market is in deceleration and more weakness lies ahead. Non-farm job openings tumbled 617,000 month-over-month in October to 8.73 million. This was the lowest since March 2021. The series reached a … Continued
The Russell 2000 had a phenomenal Friday as rate-cut expectations were brought forward to March. Futures traders now expect five cuts next year – unlikely unless the US economy craters, in which case small-caps will take the brunt of the … Continued
Following futures positions of non-commercials are as of November 28, 2023. 10-year note: Currently net short 685.4k, up 27.2k. Non-commercials do not seem ready to let go of their bearish bias just yet. This week, their holdings of net shorts … Continued
Kudos to equity bulls for having cashed in on last Tuesday’s CPI report, which was just a tad better than expected. With three up weeks in a row, the S&P 500 – as overbought as it is on the daily … Continued
Following futures positions of non-commercials are as of November 14, 2023. 10-year note: Currently net short 661.8k, up 57.3k. After six months of uninterrupted rally, the 10-year treasury yield is on pace to a down month. So far this month, … Continued
October’s CPI report showed continued disinflation since peaking last year at four-decade highs. Concurrently, Walmart, which commands a wide consumer reach with nearly $600 billion in annual sales, rather ominously commented that the company was more cautious than it was … Continued
Small-caps continue to act tentative. It is a group of stocks with the most exposure to the domestic economy, and their performance runs counter to the nearly-consensus view that the economy will do just fine next year. Oddly enough, small-cap … Continued
It is probable the 10-year T-yield has peaked at five percent. In this scenario, a sustained move lower will put shorts, who were heavily betting on higher rates, under pressure to cover. Two weeks ago, the 10-year treasury yield met … Continued