🐻♉️↗️↘️↔️⚠️🚩🔺🔻🧮 💰
1/7 🧵
Global Macro Review 08/14/2022
A big decline in $CPI to +8.5% y/y, ➕ the July services #PMI ↗️ ➕ #NFP ↗️, kept the 🔥 burning on risk assets - enough to lure the ♉️
Is this a new ♉️ market or the end of the 🐻 rally?
Let’s dig into the 🧮!
2/7
Equity volatility ↘️ across market and 🐻 Trend (T)
$VX 19.53 -1.62 bps
$VXN 25.18 -1.95 bps
$RVX 24.23 -1.07 bps
$VSTOXX 21.21 -1.64 bps
$VXEEM 19.45 -2.41 bps
Chart: $VXEEM lending support to $EEM 🆕 ♉️
3/7
US equity indices 🚀
$SPX +3.25% (w) +6.35% (T) 🆕 ♉️
$COMPQ +3.1% (w) +10.55% (T)
$IWM +5.0% (w) +12.5% (T)
Chart: $IWM - small caps have retraced nearly 50% of the 6-mo decline
3a/7
In US sectors, energy, materials, and financials led the way ↗️
$XLE +7.4% (w) -2.85% (T)
$XLF +5.55% (w) +6.05% (T) 🆕 ♉️
$XLB +5.2% (w) -1.65% (T)
$XLRE +4.15% (w) +5.7% (T) 🆕 ♉️
Chart: $XLF is +17.5% from the June lows and ♉️ (T)
3b/7
International indices also ↗️
$DAX +1.65% (w) -1.65% (T)
$SSEC +1.55% (w) +6.25% (T)
$KOSPI +1.5% (w) -2.95% (T)
$NIKK +1.3% (w) +8.0% (T)
$CAC +1.25% (w) +3.0% (T)
$HSI -0.15% (w) +1.4% (T)
Chart: $NIKK +6.55% over trade (t) = 1-mo duration
3c/7
Natural resource country ETFs led ↗️
$EWZ +7.55% (w) +0.3% (T)
$EWW +7.3% (w) -0.8% (T)
$EWC +4.25% (w) +0.95% (T)
$EWP -4.05% (w) -1.10% (T)
Chart: $IDX back to ♉️ +3.4% (T)
4/7
The $CRB 👁🗨 at the deceleration in #CPI and promptly tacked on +4.45%
Chart: $CRB is -4.9% over (T) duration 🐻
4a/7
GOLD and Metals ↗️
$GOLD +1.35% (w) +0.4% (T) 🆕 neutral
$SILVER +4.35% (w) -1.45% (T)
$COPPER +3.4% (w) -12.0% (T)
$PLAT +3.75% (w) +3.15% (T)
Chart: $PLAT is +15.6% (t) and 🆕 ♉️
4b/7
Hydrocarbons joined the ♉️ 🎉 ↗️
$WTIC +3.45% (w) -6.9% (T)
$BRENT +3.55% (w) -12.05% (T)
$GASO +6.9% (w) -26.45% (T)
$NATGAS +8.75% (w) +14.5% (T) 🆕 ♉️
Chart: $GASO deeply oversold with overhead @ ~ 2.90
4c/7
Grains with a ↗️ week
$CORN +5.3% (w) -17.8% (T)
$SUGAR +3.9% (w) -3.15% (T)
$WHEAT +3.9% (w) -31.55% (T)
$SOYB +3.25% (w) -11.7% (T)
Chart: $COFFEE ☕️ +8.35% (w) +6.0% (T) 🔥 ♉️
4d/7
$COTTON +12.95%
4e/7
$LUMBER +22.85%
5/7
UST yields ↗️ slightly on the week with 10/2s to -40.8 bps ↔️ but 30/5s to +14.9 BPS 🔺
MOVE 106.28 - 16.30 points 🐻
Chart: MOVE - a decline in treasury bond vol could be supportive for bond proxies going forward
5a/7
Convertibles and high yield ↗️ and part of the #riskon move
$CWB +2.35% (w) +6.1% (T) 🆕 ♉️
$HYG +1.15% (w) +2.75% (T) 🆕 ♉️
$LQD +1.10% (w) +2.35% (T)
$BND +0.4% (w) +0.45% (T)
$TIP +0.3% (w) -2.7% (T)
$TLT -0.8% (w) -0.35% (T)
Chart: $HYG +9.1% off lows 🩳🔥
6/7
The $USD took 🥵 from all #FX
$UUP -0.88% (w) +1.0% (T)
$FXA +3.05% (w) +2.8% (T) 🆕 ♉️
$FXB +0.57% (w) -0.9% (T)
$FXC +1.4% (w) +1.25% (T) 🆕 ♉️
$FXE +0.8% (w) -1.6% (T)
$FXF +2.1% (w) +6.25% (T)
$FXY +1.2% (w) -3.2% (T)
Chart: $UUP -2.1% (t) at risk of reversing trend
7/7
All aboard the ♉️ 🚂⁉️
The market has eased financial conditions considerably; 🩳 have covered, and $USD ↘️
Perfect 🐻 🍩 or new ♉️?
🤷🏻♂️ but #BTD in ♉️ Trends and #STR in 🐻 Trends continues to be my MO
👁🗨 on $USD and have a super profitable 💰 week!
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