Stocks, Bonds, & Dollar Stumble As Traders Reach ‘Peak FOMO’
There’s no better proxy for the traders’ level of FOMO-ness, it is the beta between momo funds and the market, and as Bloomberg notes, it is sitting near its highest level in almost two years.
Source: Bloomberg
Cause or effect – Peak FOMO is occurring along with Peak Fed balance sheet expansion…
But… while hedgies are chasing the market with everything they have… others are buying extreme downside protection with both hands and feet…
Source: Bloomberg
The Other Top…
[youtube https://www.youtube.com/watch?v=CNpqVWhgdZs]
But none of that stopped China from rallying overnight…
Source: Bloomberg
And European stocks recovered most of Monday’s losses…
Source: Bloomberg
US Majors slipped lower again on the day (despite plenty of vol-creating trade headlines)…
Source: Bloomberg
But futures show the real chaos…
NOTE how VWAP (blue line) was key trend change level all day
And stocks just kept decoupling from bonds
Source: Bloomberg
Another short-squeeze was engineered off trade headlines at the open… but again it lost its mojo…
Source: Bloomberg
Bank stocks continue to relatively outperform despite the yield curve’s collapse in the last couple of days…
Source: Bloomberg
Treasury yields were higher on the day with the short-end notably underperforming…
Source: Bloomberg
Flattening the yield curve dramatically…
Source: Bloomberg
The Dollar dropped for the 7th day in the last 8 to its lowest since Nov 5th…
Source: Bloomberg
Yuan rallied off the fix on optimistic traiff delay headlines…
Source: Bloomberg
Cryptos continue to slide…
Source: Bloomberg
Commodities were all higher on the day, but copper leads on the week…
Source: Bloomberg
WTI remains in its rising channel ahead of tonight’s inventory data…
The year’s best-performing major commodity is showing no signs of slowing. Bloomberg points out that Palladium topped $1,900 an ounce for the first time ever on Tuesday after South African mining companies halted operations in response to the country’s power cuts.
Source: Bloomberg
Tight supplies and stricter vehicle-emissions rules have fueled a string of record highs for the metal used in autocatalysts, with Citi seeing prices jumping to $2,500 by mid-2020.
Palladium is up over 50% YTD…
Source: Bloomberg
Finally, as we noted previously, recession fears have disappeared from the headlines… in a rather ominous way…as the last time this happened was the summer of 2008…
Source: Bloomberg
And as we all anxiously await Powell’s prognostications tomorrow, the market is pricing just a 0.2% chance of a rate-cut…
Source: Bloomberg
As stocks rallied in the last week, the market priced out more and more dovishness…
Source: Bloomberg
Tyler Durden
Tue, 12/10/2019 – 16:01
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