The Massively Crowded 'Long-USD, Short-Treasuries' Trade Just Got Crowded-er

The epic voyage of USD Longs and Treasury Shorts continues...

 

US Dollar speculative long positioning increased $2.5bn this week to a new record high $47.6bn (as EUR and JPY shorts rose further).

 

But it's not just the USDollar...

10Y Treasury Spec Short positions surged since the end of QE3 and Bullard's QE4 hints...

 

To their 'most short' since May 2006...

 

Each time in the past 17 years that shorts have surged, the squeeze comes and yields tumble.

*  *  *

Of course, specs are merely following the "Don't Fight The Fed" meme as they 'sell bonds' like they are told by The Fed - since the 'market', despite being its most negatively positioned in over 8 years, is apparently 'mispriced' (which as Rick Santelli explains below - is utterly ridiculous)

"if The Fed hasn't made up its mind" about when and how rates will rise, "how can markets 'price it in'?"  ... and the rant ignites from there...

 

*  *  *

We are sure this will all end well.