Posted by on November 18, 2016 9:04 pm
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Categories: Bond Business Copper Crude Dow 30 economics Economy Lehman Mathematical finance NASDAQ Russell 2000 Technical Analysis U.S. Treasury VIX Yield Curve

Collapsing currencies, bond bloodbaths, soaring cost of funds, and crumbling crude… Fuck that! Stock indices are at record highs!!!!

Some context for the recent moves…

  • Russell 2000 Biggest 2 week gain since July 2009
  • Dow Biggest 2 week gain since Dec 2011
  • S&P Biggest 2 week gain since Oct 2014
  • EURUSD Longest win streak since Lehman (Oct 2008)
  • Dollar Index Biggest 2 week gain since Lehman (Oct 2008)
  • US Treasury Bond Biggest 2 week loss since Jan 2009
  • Global Bonds Biggest 2 week loss EVER
  • Gold Biggest 2 week loss since June 2013
  • Copper Biggest 2 week gain since Feb 2010

Which leaves asset classes at extremes…

  • USD Index Most Overbought since September 2014
  • USDJPY Most Overbought since June 2015
  • USDCNH Most Overbought since Aug 2015
  • Dow Most Overbought since Nov 2014
  • Russell 2000 Most Overbought since Jan 2013
  • Major Financials SPDR Most Overbought since April 2010
  • Regional Financials Most Overbought EVER
  • Copper Most Overbought EVER
  • Gold Most Oversold since Nov 2015
  • Global Bonds Most Oversold since April 2000
  • EM Bonds Most Oversold since Dec 2014
  • Treasury Bond Most Oversold since June 2007

Spot the odd ‘market’ out… US Equities are the only winners…

Post-Trump…

The Russell 2000 is now up 11 straight days – the longest streak since 2003…

The Dow scraped out a gain on the week (while Trannies and Small Caps ripped)… (Nasdaq hit its intraday record highs today and Small Caps at record highs)

After 7 straight days of major short-squeeze, the last 3 days have been flatish, perhaps suggesting the squeeze ammo has run dry…

Note how the VIX/S&P complex ended the week… VIX was slammed to a 12 handle BUT created no bid in stocks…

Bonds had another ugly week (but the belly underperformed)…

So while everyone is excited about growth, the yield curve is flattening dramatically…

The entire US Treasury market is now underwater for 2016…

As the USD soared, so Gold and Silver have been hit but Copper and crude are holding gains post-Trump…

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