"Shit's Starting To Break" - Stock Slide Escalates Amid Copper, Credit, & Crude Carnage

One veteran macro trader summed up the markets perfectly "Shit's starting to break" - noting that 'real' macro data decoupled from stocks at the start of the year, VIX decoupled from stocks three weeks ago, EM broke over a week ago, Copper snapped last week, and now High Yield credit is breaking - stocks are always the last to catch on...

 

Russell 2000 down 4 days in a row - longest losing streak in 3 months; S&P's 4-day decline is worst since right before the election; Trannies down 3% in the last 4 days...

As Ryan Detrick (@RyanDetrick) notes, this is the first back to back loss for the S&P in 25 days. The previous 3 times it got to 25, the streak ended also.

Bloomberg's Andrew Cinko tallied up the drop from peak to trough for the five multi-day retreats in Nasdaq since election day:

  • March 1 peak: -1.4%
  • February 21 peak: -1.2%
  • January 26 peak: -1.7%
  • December 27 peak: -2.6%
  • November 29 peak: -3.1%

Small Caps are the worst performers of the last 4 days - biggest drop since before the election - testing key technical levels

 

Another day, another desperate attempt to crush VIX and drive momentum back into stocks... (VIX LoD 11.04)

 

Bonds and Stocks both sold off together again - 3rd day in a row - (as Risk-Parity funds contonued their biggest slide of the year)

 

Treasury yields rose modestly today (weak 3Y auction), with modest steepening in 2s30s...

 

HY Bonds have broken below key technical resistance (Uptrend line and 50-dma) with the biggest drop in price in almost 3 months...

 

The last 4 days are the worst for HY Credit since before the election...

 

And HY's breakdown follows Emerging Markets decoupling last week...

 

And Dr.Copper's not buying it either...

 

And stocks gave up their grip on macro data reality a while back...

 

2s10s Breakevens curve has collapsed to its lowest since June 2008

As RBC's Mark Orsely points out, the 2s10s breakeven curve has inverted - meaning the market expectes higher inflation in the short-run than long-run.

 

The USD Index managed a modest gain for the second day in a row but remains well below Friday's highs...

 

Gold dropped to one-month lows (futures down 6 days in a row - longest losing streak since election) - Gold futs broke below the 100-DMA today

 

Silver was also hit hard - biggest 4-day drop in 3 months...

 

Copper was clubbed like a baby seal - the biggest 4-day plunge in 10 months sent the economics PhD to two-month lows...

 

Desperate jawboning from the Saudi oil Minister and OPEC's Barkindo failed to sustain any gains in crude...(machines ran the stops but the chatter couldn't sustain it)

 

Finally, this remains the WTF-est chart we know of right now - as The Fed's forecast for GDP collapses, so the odds of a rate hike soar (FF Futs tumble)...

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