The announcement of QE4 last week failed to stabilize stocks. This is unlike how they behaved during QE1/2/3. Fear rules. Just a month ago, greed did. Sentiment will reverse. Last week, major U.S. equity indices were once again slammed. Even … Continued
Following futures positions of non-commercials are as of March 17, 2020. 10-year note: Currently net short 251.1k, up 36.5k. On Sunday, while cutting the fed funds rate by 100 basis points to zero-bound, the Fed also committed to purchase $500 … Continued
No one rang the bell when the longest bull in US stock market history came to an end last month. The drop was swift and decisive. Several oversold metrics are itching to get unwound. But markets are in panic mode. … Continued
Following futures positions of non-commercials are as of March 10, 2020. 10-year note: Currently net short 214.6k, up 57.9k. Next week, the FOMC meets. This follows a 50-basis-point emergency cut of last week, to a range of 100 to 125 … Continued
Following futures positions of non-commercials are as of March 3, 2020. 10-year note: Currently net short 156.7k, down 117.3k. It seems nothing matters. On a day the bond market found out the US economy produced much-better-than-expected 273,000 non-farm jobs in … Continued
Last week, all major US equity indices lost north of 10 percent and were down a lot more at session lows Friday. If there is any consolation in this, amidst the carnage, bulls stepped up to defend important support. Some … Continued
Following futures positions of non-commercials are as of February 25, 2020. 10-year note: Currently net short 274k, down 32.2k. There it goes! The 10-year Treasury yield (1.13 percent) pierced through the lows from July 2012 and July 2016 – 1.39 … Continued
Margin debt has diverged from US stocks – or not. It depends if margin debt is pitted against large- or small-caps. The former shows divergence, the latter not. Historically, FINRA margin debt tends to move hand in hand with US … Continued
US reliance on debt is growing. Having already just about used up the conventional monetary tool and a massive balance sheet, the Fed is looking for new tools – a la Japan. Stocks’ reaction function to Japanification is key. At … Continued
Following futures positions of non-commercials are as of February 18, 2020. 10-year note: Currently net short 306.3k, down 92.7k. Once again, bond bears (on price) were having to defend 1.51 percent on the 10-year Treasury yield (1.47 percent). Most recently, … Continued