Brexit-Bounce Fades As Short-Interest-Slump Signals Crash Concerns

Surprise!! After Q3's "use it or lose it" spending spree sent US macro data soaring unilaterally, October has begun with a collapse...

Source: Bloomberg

A trade deal (or not)? Brexit deal (or not)? Turkey peace deal (or not)? But retail sales slump, industrial production tumbles, housing starts/permits plunge...

Chinese stocks were flat overnight, with small-cap/tech-heavy ChiNext the biggest loser on the week so far...

Source: Bloomberg

European stocks ended lower, despite a surge on Brexit hopes...

Source: Bloomberg

US equities were mixed with Trannies and Small Caps best (squeezed) while S&P, Dow, and Nasdaq were all scrambling to hold gains...

 

Once again S&P 500 algos were focused on the 3,000 level...

 

Chaos in NFLX stock price...

 

SDC shareholders aren't smiling now...

The VIX term structure has steepened dramatically in the last week...

Source: Bloomberg

Now at its steepest since Feb 2018...

Source: Bloomberg

Treasury yields were uniformly higher by around 1bps on the day...

Source: Bloomberg

But there was some vol intraday...

Source: Bloomberg

Despite a lot of jawboning (and stocks within 1% of record highs), the market is still demanding a rate-cut in October...

Source: Bloomberg

The Dollar tumbled for the 3rd straight day (down 6 of last 7 days)...

Source: Bloomberg

Almost entirely erasing the year-to-date gains...

Source: Bloomberg

Cable chopped around all day on various Brexit headlines but ended higher...

Source: Bloomberg

The Turkish Lira was insanely volatile (stops run both ways) as Pence-Erdogan spoke and agreed a ceasefire...

Source: Bloomberg

Cryptos were higher on the day, spiking early in European session...

Source: Bloomberg

Bitcoin rallied back above $8,000...

Source: Bloomberg

Dollar weakness supported commodities across the board with Silver and Crude best on the day (but only PMs are higher on the week)...

Source: Bloomberg

Despite a huge crude build and record production, the algos decided it was time to panic-bid WTI up to a $54 handle...

Gold futures tagged $1500 but were unable to hold it...

 

And finally, the most recent surge in stocks since the start of October has been a major short-squeeze...

Source: Bloomberg

Which has plummeted overall short-interest to a critical level that has, in the past, led to crashes in stocks...

Source: Bloomberg