So Far In 2012: Nasdaq +22%; Dow Trans +3%; Gold +3%; 10Y -3bps

Tyler Durden's picture

QE-on or QE-off; Growth or No-Growth; Cleanest 'Dirty' Shirt or Un-Decoupling; none of that matters. There are divergences everywhere - intraday and long-term - but none of that matters. What matters is hope, faith, and a little Central Bank charity. That is, of course, until someone drops the bowl of global Kool-Aid (Merkel 'nein'; Bernanke 'no'; Xiaochaun 'bu') or markets believe they want Romney/Ryan. With the equity markets in general making new 2012 highs today (as we noted earlier), on a day with better-than-recent volumes and heavy average trade-size at the highs, we can do nothing but stand back and admire the year-to-date performance of bonds, stocks, commodities, and verbal diarrhea. There appeared as much stop-runs and short-covering up here as new positioning - but that's how every break out starts of course - though we note that while stocks are at 2012 highs; high-yield credit is well off its tights, VIX off its lows (and notably less steep than its steeps) and Treasuries are still way off their high-yields. There was modest selling-pressure after-hours in futures - failing to test back down to VWAP - but volume, average-trade-size, and intraday-range ended at two-week highs.


On the day, in general risk assets (as proxied by CONTEXT) and stocks were highly systemically correlated (though it seemed that Treasuries, USD, and Oil were leading equities higher early on)...


Year-to-date - high beta NASDAAPL has been the play and while apparently every hedge fund owns it - their returns remain unimpressive to say the least. Quite a divergence of performance among one nation's equities...

Interestingly, the Dow Transports' performance seems to fit more with the rest of the world's asset classes - bonds, commodities, FX - than with US equities...


Treasuries vary from +6bps (30Y) to -7bps (7Y) year-to-date...

and while the USD is up 2.75% for the year, there is decent dispersion among the majors with AUD stronger by 2.9% and EUR weaker by 4.9%...


and from the last time we were at these heights in S&P 500 e-mini futures, it's been a quick-down and slow grind higher...


Charts: Bloomberg

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0z's picture

Is there anyone here ?


Here, ere, reee ...

Hype Alert's picture

I'm sure the incumbent dipping into the SPR to buy some votes gave everybody some hope and change.  I'm not sure what has happened to people.  Seriously, there is no long term thinking any more.

unununium's picture

I hope you'll all forgive me for mentioning this asset class again; it is up 30% since the last time several weeks ago

LawsofPhysics's picture

remind me, how do it take delivery of that "asset" again?

0z's picture

Bitcoin FX Futures .... hmmm!

unununium's picture

Sure.  Because you generated it, you alone have the private key that controls the bitcoins you acquired.  The network will not allow anyone else to transfer them.

What you have is a key that grants you control over a small part of the overall pile which is agreed to exist, from discovery through current ownership, by every single node in the network.

If you want physical, you can print out your keys.  That piece of paper is your physical.  Notice that you can also have backups though, unlike precious metals.  Notice also that because of the way it works, making backups does NOT duplicate your money.

0z's picture

I dont mind Bitcoins, but I'll take my gold before I even think about my bitcoins. Please remember one thing: The Internet can die, also.

unununium's picture

I guess not all ZH'ers can recognize propaganda.  These are all akin to bank robberies and institutions being hacked, which is a risk for anyone who stores anything in an institution.

Never has the bitcoin protocol or network come anywhere close to being hacked in any way whatsoever. 

Testing bitcoins for authenticity is a lot easier than testing your gold bar for tungsten content.


Papasmurf's picture

Here we go again with the fuckin' bitcoin promotion.  If you want a coin, get silver or gold.

you enjoy myself's picture

i swear this is Ben giving the middle finger to Romney.  he's going to jack this market to insane nosebleed 1999 heights all the way thru November, with a shit-eating grin on his face the whole time, and when Romney wins he'll offer his resignation along with "good luck!'

adr's picture

Nothing matters anymore. The stock market has now decoupled from the economy and is nothing more than a computer simulation.

Sady this computer simulation makes its programmers a lot of real money. Just like an online poker scam.

The entire run of early 2012 was to support the assumption that the economy would be growing at an accelerated rate by now. With the assuption proved false, the market has now decided that the run was premature, but the end of 2012 and 2013 will show growth to not only justify the 2012 high but capable of breaking all time highs.

This insanity will of course be proven false again. The true economy will be mired in depression, but those who live off the stock market will only care if they are made to care.

There is nobody left outside the trading rooms and the media complex it employs to spout propaganda, that believes.

The people just don't know what they can do about it.

disabledvet's picture

I don't know what a "true economy" is but clearly there is insourcing to go along with the stated intention of the Fed to create inflation. If the WSJ is correct and capital flight is taking hold there are only a few areas where private capital on that scale can be "put to work." my top three are Brazil, Korea and the USA.

zebrasquid's picture

FWIW (and to me it's worth a lot) Marc Faber says in his recent market commentary letter that NASDAQ is going to get hit hard anytime now..

chump666's picture

He is on the money, NASDAQ highs usually point to market bubbles.  He called this trade years ago. 

You just got to have balls of steel to short from these tops and hold'em.

I have those steely balls.

Flaming Ferrari's picture

Happy days! Except if you're  getting Group Facef*cked On ,Both down another 6% punching new lows..

Getting Old Sucks's picture

Yup and when we're all in they'll take it.  Don't sell your gold and if you have GLD, buy real gold.

vertexa's picture

Why is Nasdaq so strong? I have no idea? Apple?

Meesohaawnee's picture

if im Romney id just fuck it right now. Its clear someone is gaming against him.

orangegeek's picture

NASDAQ up 22% - yes that is a joke.


There's still five months left and wave 3 down has not just begun.

Meesohaawnee's picture

wall street gets theirs .. joe six pack gets fucked in the ass!! Way to go hopey changey.. sign me up for 4 more!!

bullmkt's picture

i cannot understand how dumb ZH authors the see the uptrend or not.

Numerous time i have seen them proclaiming Euphoria,Idiocy,Market Schizophrenia,Peak,End of Rallz etc etc

Yet market creeps higher.These people cannot see SIMPLE uptrend.This is impossible how dumb they are not able

to see UPTREND,BULL MARKET! At DJ 12000 it was screaming buy.But its sell sell sell in ZH doom gloom short the

bottom short the rallz pick a top dumb world.well.

chump666's picture

Ah sh*t USD bids are in for the n'th time, Asia is about to teach the momo driven dumb ass market in the West a lesson

Anyone who actually trades in the market will note this:

*Spike in USD/CNH fwds indicator of shrinking funds, depreciation bets
*Anemic growth in offshore CNY deposits also weigh

is actually causing UST yields to jump, not PIMCO or stop losses.

The Asian beat-down is upon us.

chump666's picture

From FX wires:

USD/AXJ remains well support despite last night's US Dollar especially against the EUR. Asia continues to fret but I am not sure why. It was a mostly "risk on" session overnight but as soon as Asia takes the baton it is back to doom and gloom. I will put this down to the usual Friday cautious trading ahead of the weekend. Rumours doing the rounds across Asia about possible CNY band widening to 2.25% (currently 1.0%) may have dented confidence a little.

Equity crash coming, will rival 1987.