Futures green and marching up, but foreign indices are mixed. I'd tend to feel more chance for a strong bull day if we opened flat or a little down, but Cheetohunter is bullish if we open above 3806. We do need to fill the gap at 3878 soon or I think we'll head back down.
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Bob Knights Paper Hands
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Listening to the 4 fed speakers we had this weekAg CPA said:Triple_Bagger said:Powell's Sentate hearing was interesting and Biden proved once again he has no idea what he's doing.Brian Earl Spilner said:
Well, that day was a big nothing.
Fed sounds like they're leaning towards a 50bps hike in July and 25bps hikes after that.
Not sure how you are getting to this.
I listened to them as well, guess I didn't hear anything dovish like you did. Powell was as hawkish as ever yesterday.
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I'm still bearish for the next 12-18 months, but if VIX gets below 28 we are very likely to close those gaps on SPX. A test at $4100 would represent a 12.8% gain from the bottom. I'm hoping we get close and I'll reposition a bit more for bearishness unless something happens besides price to change my sentiment.
Powell Losing the Narrative...Hawkish Talk Leading to Lower Rates..2 Yr Hit 2.99
Powell was relatively Hawkish in his testimony yesterday, but you could see the push-back as Senators, in our humble opinion, are starting to be more worried about a recession... Overnight US treasuries soared in price and hit much lower yields... 2 year treasuries hit 2.99 while 10 years hit 3.08... Both have reversed a few basis points as we write...Recession fears are complicating Powell's higher rate scenario... Will it be permanent? Have we seen the high yields of this cycle?.. Both 2 years and 10 years have moved 40 plus basis points lower in yield in the last week... 2 years going from 3.44 to 2.99 this morning.. While 10 years have moved from 3.49 to 3.08... Markets are fickle, but we can see recession fears starting to challenge inflation fears as a changing narrative...
European PMI's were much lower than expected, which caused a massive rally in EGBs this morning... At one point 10 year Bunds were 21 basis points lower in yield. 2 year Bunds went from 1.06 to .80... Very big moves... Norway raised rates more than expected with a 50 basis point move... We saw that Bridgewater has levered up in shorting European equities... Why anyone wants to disclose their positioning while it is live is beyond us... "(BN) Bridgewater Doubles Short Wagers in Europe to $10.5 Billion "
Powell testimony was not surprising yesterday... He wants to keep the brake on the economy and keep pushing rates higher... He continued to stick with the neutral rate being 2.5%, but he clearly wants to exceed that... Question is how his recession talk will be counterproductive to his rate hike mantra... The correlation is simple... Powell threatens to raise rates, recession talk heats up, rates go lower... 45 in 2 years and 41 in 10 years from last week to the low this morning... But we clearly saw a mood shift in the Senate, that if you think inflation is priority number one, then watch out for the recession number two priority which is catching up fast... We do not want to focus on politics, but we got a kick out of a tweet from Jim Bianco overnight, who brought up the point that Democratic Senators thought they were questioning the Secretary of Energy and not the Fed chair...as they focused on breaking up oil companies... We could not disagree more on breaking up oil companies... And we remember our old colleague , Peter Tchir, making the point about a year ago, that ESG was inflationary for energy... He could not have been more correct... Meanwhile in the last week the WSJ reported that gasoline sales were down 8.2% compared to the same week last year..., the 14th consecutive week that sales have lagged behind 2021 levels...Republican Senators pointed out that most of the move in energy prices happened before Ukraine was invaded by Russia... And that that inflation was more correlated to the excessive stimulus plan... In their defense, no one had a Covid playbook....
New issues were weaker yesterday only coming with about 3 billion.. The metrics looked awful... Less than 2 times oversubscribed with new issue concessions at 25 basis points... Again this was not a good representative sample size . IG CDX continues to hover around 100 while HY is better, at 563, after hitting 600 earlier this week.
Fed...Powell is up today in front of the House... He will not deviate from his testimony yesterday. But we will be looking for signs that the recession fears are making inroads on the inflation fears...both are important... If Powell can not get treasury rates higher than the challenge is whether to slow it down or double down... We doubt he slows it down, so we continue to expect 50 in July, depending on the June CPI report... Or it could go to 75.. Powell did admit there was a discussion last week about a 100 basis point move... We do not know how close it got...
Equities started out negative yesterday morning, were positive most of the day, and closed marginally negative... This morning S+P futures hit lows at 7.30 pm last night and 3.37 am this morning... And have bounced about 50 points... Now up 30... Our equity desk head pointed out yesterday how all markets seem to be correlated... Risk recession , rates, and and short covering... Which means the short covering in the middle of the day was by large funds and CTA's... We pointed out Tuesday how short Hedge funds were... And his quote " the more known recession is the less likely its going to come to fruition or if there is one my guess is its not very bad"
European equities are now higher... Same logic...weak economic numbers lead to a rally in bonds... A rally in bonds means the ECB has lost the edge in how much they can raise rates... And they have not even started yet... How silly are negative rates in a 9% inflationary environment... Central Banks need less bankers and politicians, and more traders, in determining when to move... Both the Fed and the ECB should have been moving mid to late last year...
Powell was relatively Hawkish in his testimony yesterday, but you could see the push-back as Senators, in our humble opinion, are starting to be more worried about a recession... Overnight US treasuries soared in price and hit much lower yields... 2 year treasuries hit 2.99 while 10 years hit 3.08... Both have reversed a few basis points as we write...Recession fears are complicating Powell's higher rate scenario... Will it be permanent? Have we seen the high yields of this cycle?.. Both 2 years and 10 years have moved 40 plus basis points lower in yield in the last week... 2 years going from 3.44 to 2.99 this morning.. While 10 years have moved from 3.49 to 3.08... Markets are fickle, but we can see recession fears starting to challenge inflation fears as a changing narrative...
European PMI's were much lower than expected, which caused a massive rally in EGBs this morning... At one point 10 year Bunds were 21 basis points lower in yield. 2 year Bunds went from 1.06 to .80... Very big moves... Norway raised rates more than expected with a 50 basis point move... We saw that Bridgewater has levered up in shorting European equities... Why anyone wants to disclose their positioning while it is live is beyond us... "(BN) Bridgewater Doubles Short Wagers in Europe to $10.5 Billion "
Powell testimony was not surprising yesterday... He wants to keep the brake on the economy and keep pushing rates higher... He continued to stick with the neutral rate being 2.5%, but he clearly wants to exceed that... Question is how his recession talk will be counterproductive to his rate hike mantra... The correlation is simple... Powell threatens to raise rates, recession talk heats up, rates go lower... 45 in 2 years and 41 in 10 years from last week to the low this morning... But we clearly saw a mood shift in the Senate, that if you think inflation is priority number one, then watch out for the recession number two priority which is catching up fast... We do not want to focus on politics, but we got a kick out of a tweet from Jim Bianco overnight, who brought up the point that Democratic Senators thought they were questioning the Secretary of Energy and not the Fed chair...as they focused on breaking up oil companies... We could not disagree more on breaking up oil companies... And we remember our old colleague , Peter Tchir, making the point about a year ago, that ESG was inflationary for energy... He could not have been more correct... Meanwhile in the last week the WSJ reported that gasoline sales were down 8.2% compared to the same week last year..., the 14th consecutive week that sales have lagged behind 2021 levels...Republican Senators pointed out that most of the move in energy prices happened before Ukraine was invaded by Russia... And that that inflation was more correlated to the excessive stimulus plan... In their defense, no one had a Covid playbook....
New issues were weaker yesterday only coming with about 3 billion.. The metrics looked awful... Less than 2 times oversubscribed with new issue concessions at 25 basis points... Again this was not a good representative sample size . IG CDX continues to hover around 100 while HY is better, at 563, after hitting 600 earlier this week.
Fed...Powell is up today in front of the House... He will not deviate from his testimony yesterday. But we will be looking for signs that the recession fears are making inroads on the inflation fears...both are important... If Powell can not get treasury rates higher than the challenge is whether to slow it down or double down... We doubt he slows it down, so we continue to expect 50 in July, depending on the June CPI report... Or it could go to 75.. Powell did admit there was a discussion last week about a 100 basis point move... We do not know how close it got...
Equities started out negative yesterday morning, were positive most of the day, and closed marginally negative... This morning S+P futures hit lows at 7.30 pm last night and 3.37 am this morning... And have bounced about 50 points... Now up 30... Our equity desk head pointed out yesterday how all markets seem to be correlated... Risk recession , rates, and and short covering... Which means the short covering in the middle of the day was by large funds and CTA's... We pointed out Tuesday how short Hedge funds were... And his quote " the more known recession is the less likely its going to come to fruition or if there is one my guess is its not very bad"
European equities are now higher... Same logic...weak economic numbers lead to a rally in bonds... A rally in bonds means the ECB has lost the edge in how much they can raise rates... And they have not even started yet... How silly are negative rates in a 9% inflationary environment... Central Banks need less bankers and politicians, and more traders, in determining when to move... Both the Fed and the ECB should have been moving mid to late last year...
Farmer @ Johnsongrass, TX
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Thank you for providing this work/effort to us.
Read your note about gasoline sales lagging versus last year. 2 things to add, in the S&D, remove the contribution of FJB draining the SPR from the monthly total and it reveals a draw down is occurring. I believe FJB has to stop pulling from the SPR by November 2022. Second, any current sales lag in gasoline would be/are welcome to keep a lid on pump prices; however, refiners will not catch up and no recession means steady to more gasoline demand. FJB and Powell can bring the price of gasoline down but they'll have to crush the economy to do it. Pretty sad when the answer is loosen the Fed regulation restrictions imposed on Big Oil and allow them to run those refineries to the max....Green People rather see financial destruction cause you know,....saving the earth....while Germany and China get ready to crank up coal burning electric plants. Just my opinion, buy O&G stocks.
Again, thank you and I appreciate your posts.
ETA:
Yes!
Read your note about gasoline sales lagging versus last year. 2 things to add, in the S&D, remove the contribution of FJB draining the SPR from the monthly total and it reveals a draw down is occurring. I believe FJB has to stop pulling from the SPR by November 2022. Second, any current sales lag in gasoline would be/are welcome to keep a lid on pump prices; however, refiners will not catch up and no recession means steady to more gasoline demand. FJB and Powell can bring the price of gasoline down but they'll have to crush the economy to do it. Pretty sad when the answer is loosen the Fed regulation restrictions imposed on Big Oil and allow them to run those refineries to the max....Green People rather see financial destruction cause you know,....saving the earth....while Germany and China get ready to crank up coal burning electric plants. Just my opinion, buy O&G stocks.
Again, thank you and I appreciate your posts.
ETA:
Yes!
Quote:
How silly are negative rates in a 9% inflationary environment... Central Banks need less bankers and politicians, and more traders, in determining when to move... Both the Fed and the ECB should have been moving mid to late last year...
Big chop this morning.
Ranger222 said:
BABA looks to be setting up here....charts of FUTU and TIGR were going around twitter last night as potential plays. These China names have been some of the best plays recently
BABA +6%
CRWD is at its 50 day Exponential moving average. Has had some nice green days this week.
If today ends up a strong green day i think this one might get to 180.
If today ends up a strong green day i think this one might get to 180.
Jet Black
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I'm in YINN, down about 30%, neither can truly get going. They just yo-yo week to week.Ranger222 said:Ranger222 said:
BABA looks to be setting up here....charts of FUTU and TIGR were going around twitter last night as potential plays. These China names have been some of the best plays recently
BABA +6%
SPY breaks $378 we may see $380 today..
ProgN said:Biden: "For all Republicans criticizing me for high gas prices in America, are you now saying we were wrong to support Ukraine and stand up to Putin? Are you saying that we'd rather have lower gas prices in America than Putin's iron fist in Europe?" pic.twitter.com/Z7U8YIFgnM
— Greg Price (@greg_price11) June 22, 2022
Good lord if we blame Biden for gas prices then we support Putin. GFY you POS.
gaslighting at its finest right there
Just as a PSA, new short position information as of June 15th will be shared after close on 6/27. So latest short information is 2 weeks old and I'd suspect is low based on how far the market dropped over the past 10+ days.
Why it takes nearly 2 weeks to share this information is questionable given today's technology.
Why it takes nearly 2 weeks to share this information is questionable given today's technology.
Ranger222 said:Ranger222 said:
BABA looks to be setting up here....charts of FUTU and TIGR were going around twitter last night as potential plays. These China names have been some of the best plays recently
BABA +6%
Great call. Thanks for that.
I bought puts on JPM yesterday. Bought long dated 115 puts and am up well already.
Good gaps above and below to fill but a sense this one is heading down.
Good gaps above and below to fill but a sense this one is heading down.
We Now Reached 3% 10 Years... 2.91 2 Years... Where Do We Go Next?
So far we have been listening to a fierce bipartisan debate in the Powell testimony where little new ground has been reached...it is obvious that fears of recession continue to catch up with inflation as priority number 1... We will continue to listen and report... But rates markets are not waiting... 10 years have reached 3%, which was our outside objective at the beginning of the week... Now what?.. 2.71 is the next big level... But we think we stay around 3% for a bit... 10 year Bunds are 22 better... As for 2 years we have 2.78 as next objective... This makes Powell's job more difficult... Mike Wilson, MS's Bearish stock guru, was talking to Alix Steel on BB today about interest rates... He made the comment that although the Fed will continue to raise rates to catch up to the market, nominal rates could continue to stay here... 6% mortgage rates is more than enough to cool down the economy and reduce inflation... Stay tuned
So far we have been listening to a fierce bipartisan debate in the Powell testimony where little new ground has been reached...it is obvious that fears of recession continue to catch up with inflation as priority number 1... We will continue to listen and report... But rates markets are not waiting... 10 years have reached 3%, which was our outside objective at the beginning of the week... Now what?.. 2.71 is the next big level... But we think we stay around 3% for a bit... 10 year Bunds are 22 better... As for 2 years we have 2.78 as next objective... This makes Powell's job more difficult... Mike Wilson, MS's Bearish stock guru, was talking to Alix Steel on BB today about interest rates... He made the comment that although the Fed will continue to raise rates to catch up to the market, nominal rates could continue to stay here... 6% mortgage rates is more than enough to cool down the economy and reduce inflation... Stay tuned
Thread is dead
This market is getting crazy cheap. Look at a stock like LyondellBasel. LYB is trading at $85 where it was in 2018. Since 2018 they've bought back about 12% of stock, they've raised their dividend now yielding 5.7%, and earnings are almost double 2018. It's trading at a PE of 5 right now.
Makes no sense to me. Market acting like huge slowdown coming globally.
Makes no sense to me. Market acting like huge slowdown coming globally.
Jet Black said:
Thread is dead
Markets are dead. Those making profits right now are pros or lucky. Most of us are sitting on cash and waiting.
Sell calls with short expirations
So uh, eventually this thing's gonna run without promptly ****ting the bed, right?
I think this market is confusing to most of us here. Since last Thursday it has basically been one big chopfest, save for the early action last Friday.
Sure looks like an inverted HS to me.
Bob Knights Paper Hands
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Tough trading right now. I lost $200 on some puts early, made $140 on some calls, and then lost $100 on some other calls. Not much to post about.
Macros have been consolidating and getting tighter again. I think the longer we wait the less likely the next big move will be up.
Macros have been consolidating and getting tighter again. I think the longer we wait the less likely the next big move will be up.
i made 50% on CHWY calls today, and am up over 100% on my runners
I agree, the longer this goes then the move is down. Confidence polls should be very low right now and I think that is reflected here.
Or went to the school for scalpers taught by FJDanwell Home said:Jet Black said:
Thread is dead
Markets are dead. Those making profits right now are pros or lucky. Most of us are sitting on cash and waiting.
23 June 2022austinAG90 said:
We Now Reached 3% 10 Years... 2.91 2 Years... Where Do We Go Next?
So far we have been listening to a fierce bipartisan debate in the Powell testimony where little new ground has been reached...it is obvious that fears of recession continue to catch up with inflation as priority number 1... We will continue to listen and report... But rates markets are not waiting... 10 years have reached 3%, which was our outside objective at the beginning of the week... Now what?.. 2.71 is the next big level... But we think we stay around 3% for a bit... 10 year Bunds are 22 better... As for 2 years we have 2.78 as next objective... This makes Powell's job more difficult... Mike Wilson, MS's Bearish stock guru, was talking to Alix Steel on BB today about interest rates... He made the comment that although the Fed will continue to raise rates to catch up to the market, nominal rates could continue to stay here... 6% mortgage rates is more than enough to cool down the economy and reduce inflation... Stay tuned
2 year bond: 3.0
10 year bond: 3.0
what are they stating as the significance of lower bond rates?
What's amazing is probably 60-70% of America has tuned this crap out.AgsMyDude said:ProgN said:Biden: "For all Republicans criticizing me for high gas prices in America, are you now saying we were wrong to support Ukraine and stand up to Putin? Are you saying that we'd rather have lower gas prices in America than Putin's iron fist in Europe?" pic.twitter.com/Z7U8YIFgnM
— Greg Price (@greg_price11) June 22, 2022
Good lord if we blame Biden for gas prices then we support Putin. GFY you POS.
gaslighting at its finest right there
I hope him and the Dems keep it up though. Blaming Putin and the GOP while offering no solutions is going to get them slaughtered in November.
Jet Black said:
Thread is dead
This week is definitely the quietest I've ever seen this thread.
Everyone has thrown in the towel huh? BULLISH!
Short squeeze mega rally coming soon.
Short squeeze mega rally coming soon.
If this post is on the B&I forum, lighten up it's just money!
Disclaimer: I'm not that smart.
Disclaimer: I'm not that smart.
Bob Knights Paper Hands
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I bought a loto TSLA710C that I'll hold until $30 or overnight if I gots to.
Bob Knights Paper Hands
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Let's get VIX back below 29 and turn this into a big green week!
Bob Knights Paper Hands
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But I am concerned about potential for a power hour selloff.
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