Stocks & Dollar Jump As Bonds, Bullion, & Bitcoin Dump

After a chaotic open (as retail sales sparked optimism and Fed’s Bullard did the opposite), the trend was ‘buy all the things’ in stock-land until the European close. Then Small Caps and Big Tech diverged (lower and higher respectively)…

Chatter about Biden’s pick for The Fed was suggested by some as a catalyst for the ramp but that seems a bit far-fetched even for this idiotic market… but who the f**k knows! Just how much more dovish could Brainard be without utterly destroying the dollar and The Fed’s credibility?

Also, that seems unlikely given the hawkish shift in STIRs today.

Nasdaq’s (growth-dominant) strong outperformance has erased all of Russell 2000 (value-dominant) for November…

“Most Shorted” Stocks were squeezed yet again

Source: Bloomberg

Defensives were definitely dumped today but while Cyclicals ended notably higher, they really reversed after Europe closed…

Source: Bloomberg

Treasury yields were higher on the day with the long-end underperforming (but the moves were modest compared to yesterday’s chaos). 30Y Yields are now up over 9bps this week while 2Y is unch….

Source: Bloomberg

The question is – will we see buying in Asia again tonight?

30Y Yields closed above 2% but were not showing signs of breaking out, even as stocks ripped…

Source: Bloomberg

The dollar closed at its highest since early October 2020…

Source: Bloomberg

Crypto took a beating today, accelerating yesterday’s drift lower. Litecoin was worst among the major coins with Bitcoin and Ethereum down around 7%…

Source: Bloomberg

While there were lots of potential catalysts, as we detailed earlier, we do note that The DoJ dumped $56 million in seized crypto on the market to compensate victims of the BitConnect fraud.

Bitcoin plunged back below $60,000 but found support perfectly at $58700 which just happens to be the 50-day moving-average…

Source: Bloomberg

Interestingly, the last few weeks have seen the correlation between bitcoin and gold increase significantly as both have benefited from inflation-safe-haven flows…

Source: Bloomberg

And as that regime shift has occurred, it looks like a rotation back from crypto to the precious metal has begun…

Source: Bloomberg

Gold was down today, but held well above the $1800 level…

WTI fell back to $80 intraday but bounced, ending slightly lower overall ahead of tonight’s API data…

Finally, it may be time for a “great rotation” away from shares of faster-growing U.S. companies and toward cheaper stocks, according to Crescat Capital. The money manager cited a comparison of enterprise value relative to sales for the Russell 1000 growth and value indexes in a blog post Saturday.

The growth-value gap widened to 3.41 points, according to data compiled by Bloomberg, exceeding a peak of 3.40 points from July 2000, shortly after the end of an Internet-driven bull market.