Another day, another Hindenburg Omen sighting as Fed speeches did little to provide moar exuberance as better-than-expected data keeps hinting at an early Taper and removal of the punchbowl. Stocks have seen two days in a row of 'redness' with a mind-numbing loss of around 0.7% for the S&P 500 (and more for the Trannies) that sparked a litany of 'off-the-lows' and 'moral victory for the bulls' comments as volume remained lack-luster at best (all compressed into the sell-off phase into the European close). The Taper picture remains a little unclear across asset-classes though; as gold, silver, and oil dropped (Taper on), Bonds unch (Taper hhmm), stocks down led by builders (Taper on), USD weakness (Taper not on) but JPY strength was the driver (carry unwind on Taper on). VIX pressed up towards 13% (its biggest rise in 7 weeks) and credit is underperforming.
Do Not Panic!!
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and volume came out (on the selloff)...
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Hindenburg Omen are clustering...
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Homebuilders are fading fast again...
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The big driver of weakness appears to be JPY cary unwinds again... with JPY now at its strongest against the USD in 7 weeks...
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Gold has seen a rather weak last 10 days...
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as the USD has slid over 3% in the last 21 days...
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The cross-asset-class correlation is picking up in a systemic manner once again... as risk-assets cling to one another...
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While only a small absolute pop, VIX's relative jump today is the biggest in 7 weeks and ended on a decidedly hedged basis (even as stocks pushed for VWAP)...
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and hedgers remain active in credit too...
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Charts: Bloomberg and Capital Context