So as our newest position will show, and as you have seen us post throughout the Twitter / X stream?
We have turned bearish on risk as of last week. Today? Marks day 5 of our broad risk model having us ‘risk off’. Now … let’s also say that you cannot control getting whipsawed by the market, because you can”t control the future. What CAN you control? ‘Chip management’, so to speak. Position sizing. Let’s talk about that for new and aspiring folks …
You can find the video as below on YouTube, and is available in many other video venues (Vimeo, Odysee, etc)
Here is the the note itself, for this week on a 0 to 15 day Periodicity …
This Week on the Calendar:
Monday: 8:30 AM EST – Retail Sales MoM – Consensus 0.3%; Actual 0.7%
NY Empire State Manufacturing Index – Consensus -9; Actual -14.3
Tuesday: 8:30 AM EST – Building Permits and Housing Start Data
SOFR Yield Curve: We are in the H4L+ camp at the moment. This Monday, experiencing a small intraday drop in yields, though we are still at higher yields than we were last week. Last red has us finally pricing higher yields than the Fed …
Treasury Yield Curve: The yield curve is inverted. As it has been. For some time.
… The 10 year is at 4.626% and continuing to rise as yields across the rate markets continue to spike higher. The 4 Week Bill Yield is 5.37%. The 52 Week Bill yield is now at 5.169%. The 52 Week Bill has been moving to higher yields since the middle of January.
Overall Risk: (Stock Indices, Gold, Crypto, Long Bond, Bills): Overall Risk, we remain bearish, as we turned bearish last week. This is day 5.
Equity Volatility: (VIX) We are at 17.85 and +0.53 at the moment on the day. We have volatility that I would rank as warm .
Equity Volatility VIX TERM STRUCTURE: We have just flipped into backwardation in VIX Terms. April being worth more. Indicating risk conditions. Starting in May of 2024, the terms flip back to Contango until October of 2024 (Big surprise there, and yes I’m being sarchastic).
Equities: (SPY, SPX or possibly the /ES) As mentioned in the twitter stream we have switched over to bearish on Equities.
S&P 500 High Yield: (SPHD) We have switched over to neutral on S&P 500 High Yield price, neutral on yield.
Treasuries: (FRONT: SHY, MIDCURVE: IEI, IEF, BACKEND: TLT or the /ZT, /ZF, /ZN, /TN, /ZB and /UB). On SHY out to TLT we remain bearish on price, bullish on yield.
Emerging Markets: (PCY, VWO) On Emerging Market Debt prices (PCY), we have switched over to bearish on price, bullish on yield. For Emerging Market Equity Prices (VWO), we have switched over to neutral.
High-Yield: (HYG, JNK) We have switched over to bearish on price, bullish on yield.
Commodities: (GSCI, DBC or GSG) We have switched over to neutral on Commodity Prices as a whole index.
Crude Oil Term Structure: The entire forward curve out to 2027 is in backwardation (image attached for front contract spread in next post).
Crude Oil Specifically: (USO, USL and /CL) We have switched over to neutral on Oil Prices.
Gasoline Specifically: (UGA and /RB) We have switched over to neutral on Gasoline Prices.
Gold and Silver Specifically: (GLD / /GC and SLV /SI) We remain bullish on Gold prices. We remain bullish on Silver.
Bitcoin / Crypto Markets: (/BTC or IBIT) We are just now turning bearish on Bitcoin / Crypto.
Currency: ($DXY:IFUS, UUP) We had switched over to bullish on the US Dollar as an Index.
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