Crypto Rips, Dollar Dips, & Stocks Hit Record Highs As Americans’ Confidence Collapses

If the stock market is a “forward-looking” mechanism, then the future it sees is very, very different from the ‘expectations’ that the average American has about what’s looming…

Source: Bloomberg

Put another way…

On the week, The Dow outperformed (which has been relatively unusual) with Nasdaq breaking even and Small Caps tumbling. Notice that every day the cash open (this is 24hr futures data) was utter chaos before everything calmed down in general

Euro Stoxx 600 is once again outpacing the S&P this year (with its 10th consecutive record high in a row – the longest such streak since 1999)… and they are both crushing Chinese stocks…

Source: Bloomberg

The Russell 2000 failed to break and hold the 100DMA six times in the last two weeks and today saw it leg down to the lower end of its recent range…

Defensives outperformed Cyclicals on the week with the last two days dominating that shift (but both were higher on the week)…

Source: Bloomberg

Value outperformed Growth this week (though the last two days have seen Growth relatively bid)…

Source: Bloomberg

Materials and Staples outperformed on the week while Energy and Tech were the laggards…

Source: Bloomberg

Notably, this week saw the energy sector cap a 19-day streak in which no member of the index traded above its 50-day moving average, the second-longest span since the late-1950s, data compiled by SentimenTrader show. That’s something that hasn’t happened since the summer of 2001 when Enron and its ensuing bankruptcy was pressuring the energy complex.

Today’s bid for Treasuries erased any weakness on the week, pushing yields back to unchanged…

Source: Bloomberg

10Y Yields met resistance at around 1.36% which coincides with a critical post June FOMC plunge spike low in yields…

Source: Bloomberg

The dollar plunged today starting around the European open, and accelerated on the confidence collapse. That drop took the reserve currency negative for the week, and erased most of last Friday’s payrolls print gains…

Source: Bloomberg

Cryptos rallied this week, led by Ripple with Ether and Bitcoin up around 8-10%…

Source: Bloomberg

Bitcoin rebounded strongly today after weakness yesterday, closing back above $46,000 (highest close since May)…

Source: Bloomberg

And Ethereum followed a similar trajectory, closing back above $3200, also the highest since May…

Source: Bloomberg

As the dollar dipped, gold ripped higher, erasing all of Sunday night’s flash crash and some of the payrolls plunge…

Given where real yields are (modestly lower, more negative this week), gold has more room to run here…

Source: Bloomberg

Oil was volatile on the week but circled back to around unchanged…

Finally, in case you wondered what was driving stocks, given that you must have been living under a rock – as confidence among the actual consumers is collapsing to 10 year lows…

Source: Bloomberg

…it’s simple… $30 trillion of global central bank liquidity (which has risen $10 trillion alone since the March 2020 lows)…

Source: Bloomberg

Is this as good as it gets?

Source: Bloomberg

Because, a lot of traders are betting on The Fed screwing things up bigly in the next few months…

Source: Bloomberg

And will never raise rates (in fact they might cut them!)..

Source: Bloomberg

Don’t fight The Fed… until The Fed blows it all up.