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S&P Stalls At Critical Resistance Again Despite Massive Short-Squeeze

S&P Stalls At Critical Resistance Again Despite Massive Short-Squeeze

Tyler Durden

Wed, 07/15/2020 – 16:00

The last two days have seen the biggest short-squeeze in 3 months – a massive 8%-plus swing from yesterday’s lows…

Source: Bloomberg

Does make u wonder…

[youtube https://www.youtube.com/watch?v=mXmNpdYpfnk]

As vaccine headlines that in reality offered nothing new sparked a panic-bid for Small Cap stocks that was then accelerated by more vaccine headline from Europe…

0610ET *POSITIVE NEWS COMING ON OXFORD COVID-19 VACCINE: ITV’S PESTON

The headlines sent serial insider-seller MRNA shares screaming higher…

Fed by over 50,000 fresh young Robinhood’rs diving in today…

https://platform.twitter.com/widgets.js

But the S&P 500 was unable to break a crucial support level around 3230.78 (2019 close) after testing it four times intraday…

…its 2019 close and the interim lows in January…

Despite Nasdaq’s massive outperformance YTD, the last few days continue to see the big-tech index underperforming the other majors…

 

…and that has sent expectations for future volatility soaring to their highest relative to the S&P since 2004…

Source: Bloomberg

Banks ended the day higher after Goldman crushed it… but note that Goldman’s early gains were almost entirely erased and WFC and C were bid as GS slid…

Source: Bloomberg

Treasury yields were mixed today (long-end very modestly higher in yield vs short-end flat to marginally lower) but all yields remain lower on the week, despite the equity exuberance (with the belly outperforming)…

Source: Bloomberg

10Y roundtripped just like on Monday, bid during the US session…

Source: Bloomberg

The Dollar fell for the second day in a row, despite a rebound in the US session…

Source: Bloomberg

 

 

Source: Bloomberg

Copper was lower today (for a change) as oil prices jumped after DOE confirmed API’s big crude draw…

Source: Bloomberg

WTI ramped back above $41, shrugging of OPEC+ output increase headlines…

Silver also had a big day, with futures pushing up towards $20…

Gold was bid today, marginally, with a post European close rally once again, erasing overnight losses…

Source: Bloomberg

Which combined to push the Gold/Silver ratio down to its lowest since February…

Source: Bloomberg

Finally, we note that companies in the MSCI USA Index now represent a record 65.3% of the MSCI World Index

Source: Bloomberg

And given that dominance, it seems odd that US equity markets are now trading at the same level of risk as Emerging Markets

https://platform.twitter.com/widgets.js

As @Not_Jim_Cramer notes, US markets achieve banana republic volatility. Either this mean reverts, or there will be one helluva valuation adjustment.


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About The Author

Tyler Durden

Zero Hedge's mission is to widen the scope of financial, economic and political information available to the professional investing public, to skeptically examine and, where necessary, attack the flaccid institution that financial journalism has become, to liberate oppressed knowledge, to provide analysis uninhibited by political constraint and to facilitate information's unending quest for freedom. Visit https://www.zerohedge.com

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