Powell Saves Stocks But Crude, Cryptos, & Yield Curve Sink

As if last week never happened - sell as much vol as you can because Jay Powell can turn back time...

 

It appears the stagnation of the rebound overnight was enough to bring out the committee to save the world as Jay Powell uttered some words this morning on financial stability... and the world was saved again...

 

Dow futures tested up to the 50% retracement once again today... and failed...

 

On the day we opened weak before Powell saved us all, but there was another weaker close...

 

Notably the other leg up in stocks happened around 1300ET - when someone suddenly lifted USDJPY... Thank you Kuroda-san...

 

Stocks are up 5 to 6% now from Friday's lows.. Small Caps are lagging for now...

AMZN is now up 10% off the Friday lows...

 

VIX was monkey-hammered back below 25 briefly...

 

While vols came in modestly today across all asset classes, rate vol - on a normalized basis - appears to have stuck at more elevated levels...

 

Treasuries were mixed today with the short-end weak and the long-end bid...

 

This sparked a notable 5bps flattening in 2s30s...

 

For those hoping for higher rates, better start placing your bets on copper outperforming gold some more...

 

The Dollar resumed its incessant downtrend once again today...

 

Crude slipped lower once again - but copper ripped higher - as PMs managed gains against the weaker dollar


 

WTI closed below $60 again and RBOB below 1.70 ahead of tonight's API data...

 

Gold topped $1330 and Silver topped $16.50 today as the Gold-to-Silver ratio topped 80x - the highest since April 2016...

 

Cryptos were lower on the day but Bitcoin is up from last Friday's close...

 

Bitcoin ended the day modestly lower but tracked VIX once again this afternoon (BTC higher as VIX dropped)...

Comments

Hammer823 Tue, 02/13/2018 - 16:02 Permalink

Another day of dip buying pays off, as expected. With a mad rush to buy ahead of tomorrow’s CPI.  Word got out that no matter what the CPI is, it will be “good” for the market. 

Keltner Channel Surf Hammer823 Tue, 02/13/2018 - 18:15 Permalink

It seems the ZH boards are now visited by folks that are, net-net, less knowledgeable about the details of markets than years ago, given content changes, click-baiting, etc.  As a result, we’re seeing more spammers and charlatans, and this fellow falls neatly into the latter category.

On his Instagram page you’ll hear him braying about a 60%+ return in 6 months in a voice that’s a cross between the Aflac duck,  P.T. Barnum and a 40s film noir Chicago-style gangster, using the name “John Galt (i.e., Atlas Shrugged) from the ‘Rigged Street Journal’” (how cute), doing triple levered oil and financial trades.

Now, it’s entirely possible for a very gifted mean-reversion trader using 3X Direxion funds to earn this level of returns, and I obviously have no way of confirming them.  So, what’s the problem, the red flag (aside from the fact that the Yahoo finance screen shots are time-stamped, but the Instagram posts are only day-stamped, get it?)?

Well, ABSOLUTELY NO real trader would claim to succeed because the ‘market is rigged’, allowing him to do ‘the same trades at the same time every day.’   Home-grown algorithms, or complex mean-reversion click-trading, considering multiple time-frame volatility envelopes, volatility stops, volume bursts, cross-asset correlations, etc., perhaps -- but never “it’s easy because it’s rigged.”

For every day an 11:00 FAS reversal to FAZ works, there are 5 in which it doesn’t, and many that include huge pin-bars that wipe out any reasonable stops, and those with stops 10-feet wide don’t tend to get 100% annual returns.  Given the estimated failure rate for retail traders is close to 100%, do you really think doing the same damn triple-levered trades each day simply because the market is ‘rigged’ will work?  Don’t you realize there are artificial intelligence robots that would pick up and arbitrage away any such easy gains?

In the end, regardless of whether his stated returns are real, he’s playing to the new gallery here, whether as a joke or to sell something down the road, I don’t care.   Nor do I care whether you vote him up or down, just don’t take anything he says seriously.  Modern life is never that simple …

In reply to by Hammer823

Mad accountant Tue, 02/13/2018 - 16:02 Permalink

Nothing has changed. Everything in sight is being bid at every dip. A lot of junk has barely budged in this "correction" and is still sitting at all time highs!

Keltner Channel Surf Tue, 02/13/2018 - 16:07 Permalink

“Powell’s Army”   from  “Oliver’s Army”   by Elvis Costello

Don't start me trading, I could trade all night
My mind went ‘Jay’-walking while I was putting up the fight
Called careers information - trading’s not considered an occupation

Draghi's army is here to stay, Powell's armies are on their way
And I would rather trade anytime else
than here today

There was a Plosser, Charlie, he didn't crack a smile
But it's no laughing party, when the doves were all lined up for miles

Only takes one inflation trigger, but central banks don’t have much rigor
. . .
But there's no danger - it’s no ’professional career’
Though it could be arranged by taking the Skittles from Mr. Powell’s beer

If you're out of luck or out of work, just access NYSE from the suburbs

Draghi's army is here to stay, Powell's armies are on their way
And I would rather be anywhere else  
Than in these markets today

moonmac Tue, 02/13/2018 - 16:17 Permalink

When our Economic Professors promised us we’d never have to experience another Great Depression ever again I didn’t realize they were only referring to wealthy money manipulators and not the American Working Classes. The Fed managed to transfer the economic misery on to poor workers which has made millions of them kill themselves with drugs and suicide.