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Markets Flat on Monday as we Approach the End of Q2US Futures traded relatively flat on Monday morning, and are sitting near ATH's to start the week. The Dow is down -0.7% to 34,308, the S&P up 0.9% to 4,276, the Nasdaq up 0.32% to 14,384, and the Russell down -0.11% to 2,329.50 as of 9AM. It's insane to me to watch quantitative hedge funds underperforming retail traders, while asset valuations becomes more and more stretched due to mindblowing liquidity from central banks, corporate buy-backs, and persistent and obsessive jawboning of markets by policy makers. It's as though they're allergic to price discovery, or maybe it's just logic? The Dollar (DXY) is holding steady just under a 92 handle, while the US10Y yield continues to drift lower. We're holding on to 1.50% at the moment but we've been stuck in a persistent downtrend since the end of March. Bitcoin tested a 35k handle in the overnight session but has since slipped back to 34,382 with about 30 minutes to the cash open. I feel for the crypto permabulls who will be left holding an empty bag when this ponzi comes crashing down, but anyone who looks at secular cycles will see that inflation, and as a result, rates, are about to skyrocket. When this market eventually reprices, it's going to be vicious. Vix is sitting at 16.12 after testing long term trendline support, and looks poised for a major spike in the near term on a way overdue correction across the asset classes. With valuations going essentially parabolic, money managers are starting to worry about the implications of inflation on an already struggling global economy. The central banks are stealing wealth from the working class, and liberal governments all over the globe are cheering on the fiat debasement, while their loyal voters foot the bill, and beg for more. The feeling of cognitive dissonance has to be infecting policy makers minds by now, as they single handedly destroy capitalism. When price means nothing and supply and demand are controlled by policy makers, it's no longer a market, folks. Let's see how the week shapes up as we approach the final trading days of Q2. Stay tuned for our live analysis starting at 9:30AM. Cheers, Michael.
AMEX:SPYShort
by Hedge_Of_The_World
4
Stocks - Lotka-Volterra Predator-PreyIdea for Stocks: The Lotka–Volterra model makes a number of assumptions, not necessarily realizable in nature, about the environment and evolution of the predator and prey populations: 1. The prey population finds ample food at all times. 2. The food supply of the predator population depends entirely on the size of the prey population. 3. The rate of change of population is proportional to its size. 4. During the process, the environment does not change in favour of one species, and genetic adaptation is inconsequential. 5. Predators have limitless appetite. The bottom line is that when prey population rises, predator population follows, before prey is hunted back down to the baseline and predators starve - in a continuous cycle. - Call-Put ratio can be seen as prey (pure bullish positioning), SKEW can be seen as predators (tail risk positioning). - VIX (death rates) rise as prey and predator populations fall together. - Clear relationship can be seen as prey population rises > predator population rises > (VIX rises) > prey population falls > predator population falls > (VIX falls) > Repeats - From 2008, it appears that (4) had been violated due to QE following the 2008 crash, but the environment is returning to normal around 2017. Speculating a return to a normal predator-prey relationship. Prey population cannot continue to grow as predator population grows with it. Reset of cycle is near. GLHF - DPT
USI:PC
by UnknownUnicorn1043646
Volatility - Nothing New Under The SunIdea for Volatility: - Wyckoff Cycle Mapped. - Wave Frequencies synced. - Cause and Effect determined. - Greater Cycle: - Bonds Volatility looks ready: - China Credit Impulse turns negative, consequently the global credit impulse turns negative. - Liquidity Flow: Credit > Bonds/Currencies > Commodities > Stocks. Fighting the Fed: - Reading the Curve: - Data Suppression: - Volatility Suppression: - DXY is in a rising Trend: - Decision point for the Dollar: - Dollar is goosed, but Yen seems to be telling, as the Yen is seen as a haven currency and AUD is correlated to inflation: - Yuan is very telling for the global economy: - Bond yields (CN & US) are telling: - Forecast suggests a Volatility spike this summer. - It is likely that a greater explosion in Volatility will follow... speculating the date to be September Quad Witching 2022 (September 16, 2022). It's Black Swan season... Look out for them, but they are never the cause. It is all about the Credit Cycle. GLHF - DPT
TVC:VIXLong
by UnknownUnicorn1043646
SPY at Critical Risk Off Gamma ZoneAccording to Spot Gamma, below 4,200 on the S&P is risk off. Let's see if the bulls can recover and get us back above this critical level, or if the bears hammer us lower and take advantage of the BTFD volume. We're sitting just above trendline support (in green), and MA supports just below (21EMA and 50DMA). If we see any real risk off moves today or tomorrow on Quad-witch, this light volatility could spiral into a full blown correction. It's about time...
AMEX:SPYShort
by Hedge_Of_The_World
12
US Futures Drift Near Overnight Lows, Jobless Claims SpikeUS Futures are hovering near yesterday's lows after a shaky start to the overnight session saw us reverse the Powell driven buying spree that started around 2:45PM when he said to take the dot plot with a "pinch of salt." Powell is now essentially saying that the Fed doesn't know what it's doing, so don't really listen to what the members think. I mean, this guy is a complete idiot imo. After rallying to erase essentially all of the afternoon losses, futures tanked shortly after the close, and we tested new session lows, to then drift marginally higher. As of Thursday morning at 9AM the S&P was trading down -0.31% to 4,200, the Dow was down -0.23% to 33,828, with the Nasdaq down -0.38% to 13,918, and the Russell down -0.32% to 2,302.60. The Vix rose 2.5% to 18.61, while the dollar continued it's spectacular bounce to 91.81, up 0.46%. The US10Y yield also rallied hard after the FOMC minutes - but we're cooling lightly here before the open and sitting at 1.557%. Gold is crashing and is down over 4% on the day. We're sitting at 1,785 and losing the 100DMA at 1,797. We're back in the descending channel, and looking at further downside as we approach the end of the trading week. Oil continues to rise, and is sitting just below a 72 handle, up 0.39% on the day. Lastly, we saw jobless claims come in higher than expected moments ago. Initial claims rose to 412k vs the 350k expected, while continuing claims remained flat at 3.518MM (3.517 prior). Needless to say, investors are finally considering the fact that the cost of servicing debt is going to rise soon putting pressure on (debt fueled) asset prices, and in short order (by June 26th), roughly 1.5 million Americans will lose unemployment benefits. In September, apparently another 9 Million or so will lose benefits. Stagflation here we come... Our live analysis begins at 9:30AM. * I am/we are currently long HUV, UVXY
TVC:DXYLong
by Hedge_Of_The_World
12
VXX finally getting ready to rumble?VXX has been very consistent in its following trend lines and over the last week it has dipped below its major support line. The news from the Fed today has clearly started some level of pull back in the markets (DJI has been showing that for a week). Now will this just be a side ways move or something more substantial? The markets has defied all odds so far so it may be good to wait for confirmation, but if you are a risk taker maybe something to consider. 4h 4h close up 2h
CBOE:VXX
by Dr_Roboto
Vix Weekly RSI Lowest in Almost 8 Years?The Vix recently caught a bounce off one of the lowest weekly RSI prints since 2013. We've seen support each time the Vix hit a weekly RSI of 41, and so Vix may finally be on the verge of a notable spike soon, which leads me to believe that the Fed may surprise markets today by being more hawkish than expected, or opex (quad-witch) on Friday may be a disaster for risk. Either way, I think the worse could be over for Vix, at least for a brief period of time. Let's see what happens this afternoon when we get the Fed minutes...
TVC:VIX
by Hedge_Of_The_World
2
ABNB: Retest of 21EMA, Then a Rally to the 50DMA?ABNB lost some steam yesterday after testing a 153 handle. We saw some light inflows today at the open, which have now been erased, but we look poised to test the 50DMA sitting around 156.36. We also have room to run toward the upper band of the triangle around 160 if the 50DMA is captured, where we should see strong resistance and possibly a continuation of the recent (persistent) downtrend. A break above the upper band resistance would see us breakout and a new uptrend would form. The major headwind here is sentiment around growth. If the Fed comes off even remotely hawkish, growth is going to tank...
NASDAQ:ABNB
by Hedge_Of_The_World
FB: Potential Upside to 360?FB is channeling up nicely and showing potential upside to 360 where the upper band of the channel is sitting as of today, which would imply a new ATH, of course. We have downside to around 300 where we should see notable support. If we lose 300, we still have channel support currently sitting around 285. This is a pretty persistent trend, so I don't expect much deviation outside of a shift in sentiment, which of course could be brought on by a number of factors, not the least of which is logic...
NASDAQ:META
by Hedge_Of_The_World
VOLATILITY B WAVENew all-time highs in the market combined with a creeping VIX are cause for some alarm. Inflation hedges/bets seems to be the talk of late with inflation on the rise.. and this is not unwise considering that money supply is off the chart and velocity is sure to pick up... although velocity is not a necessary component of inflation. Remember that the market is forward looking and when something becomes obvious to you, you are are usually late to that fact. I believe volatility is bottoming in this range and is very likely to start the B wave of a larger wedge. I had expected this to begin sooner. If this is indeed a new, larger wedge, then perhaps it's even bigger than I anticipated. I also believe the market is quite a ways off from any major crash like we had in March of 2020...perhaps years out. But that does not mean we will not have sharp drops with periods of volatility.. I tend to think we are nearing that now. Be on the lookout for market noise and flush-outs. There are likely to be some decent buying opportunities made available in many stocks soon. Hold fast.
TVC:VIXLong
by gghsusa
4
Futures Rise as Retail Traders Shrug Off Hottest CPI Since 1992Happy Friday folks! Let's get right into it today. US Futures traded relatively flat in the overnight session with the Dow down -0.12% to 34,420, the S&P down -0.11% to 4,233, the Russell up 0.29% to 2,315, and the Nasdaq up 0.07% to 13,969 as of 8:30AM. Yesterday's PA came as a bit of a surprise to trading desks across the Capital Markets, as the typical reaction to red hot inflation is a more hawkish shift in policy and an increase in the cost of servicing debt, pulling a significant amount of flows away from growth heavy indexes such as the Russell and Nasdaq, leading to more defensive positioning at the very least. However, sans the light selling on the Russell, what we saw was next to no fear at all, or demand for risk protection for that matter. Markets and particularly market signals are completely broken right now it would appear, as Billionaire Stan Druckenmiller rightly pointed out shortly after the red hot data. The best performing trading strategy over the past year has been buy and hold. So in other words, doing absolutely nothing but remaining as risk on as possible, this entire time, which many, if not most, retail traders have done, has outperformed hedge funds by 10 to 1. In my honest opinion, this is no longer a "market," far less an efficient or free market. The US10Y yield continued to fall as bond markets bought the Fed narrative of transitory inflation, and almost completely ignored Thursday's highest CPI print since 1992. The Dollar (DXY) rose 0.32% to 90.35 showing potential signs of derisking in growth, while Vix slipped back to a 15 handle, and is sitting at the lowest level since before the March 2020 lockdown crashed markets 35%. Gold is sitting just below 1,900 around 1,890 and is down -0.30% on the day, while Bitcoin (BTCUSD) rose 1.38% to 37,215. Finally, USOIL rose 0.11% to 70.16. * I am/we are currently long HUV, UVXY
CME_MINI:ES1!Short
by Hedge_Of_The_World
9
calls on the VXX Betting on a spike in the vix tomorrow after the CPI number comes in hot. Too many signs of inflation to ignore, there's no way the CPI comes in softly. I think the markets will have a slight reaction which should spike the "fear index" for a brief period of time, long enough to sell the calls in-the-money Strategy to profit from this possibility: VXX expiration June 11th $33 strike calls (ITM) VXX expiration June 11th $34 strike calls (OTM) Vix spikes are usually short-lived and this is playing off a specific catalyst, specifically, the CPI being reported at 8:30 am June 10th.
CBOE:VXX
by EBITDAtiger