Yes, we are a bit late on the Weekly Note, but it’s an abbreviated week. We review where we have come from in our thoughts on Inflation, and our thoughts moving forward …
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:
Wednesday: 2:00 PM EST – FOMC Minutes
SOFR Yield Curve: As previously discussed, all eyes have been on the March 2025 90 Day Interest Rates (SR3H2025). We have discussed that a sell-off in that market to higher interest rates would not surprise us, as the market meets the Feds Inflation’s expectations (Dot Plot). Not that these two data points ‘had to meet’, but rather, we are witnessing a reverse of globalization; making inflation sticky within the United States economy
At this point, we are back into ‘evaluation’ of incoming data; as we believe all Inflation Data for the remainder of February, March and April will be critical for determining even ‘where we are’ in terms of inflation. Especially, as headwinds are beginning to appear; signaling an economic slowdown.
Treasury Yield Curve: The yield curve is inverted. As it has been. For some time.
…. and as with STIRs, or should I say … with STIRs reflecting as a proxy, movement in Treasuries? We see the 2 year move to higher yields all of last week. The Bonds also broke the previously mentioned 119’19 region. From the 5’s to the Bonds a clear price structure has been created at the 117’30 region; if we look to the Bonds as a proxy for a price shelf. We’ll see if we can pop lower there. The 4 Week Bill Yield is 5.4047%. The 52 Week Bill yield is now at 4.9885%
Overall Risk: (Stock Indices, Gold, Long Bond, Bills): Overall Risk, we had already switched last week to bearish, in a general, broad, overall bias.
Equity Volatility: (VIX) We are at 15.41 and +0.71 at the moment on the day. We have volatility that I would rank as cool, to slightly warming up.
Equity Volatility VIX TERM STRUCTURE: Normal risk and premium conditions as the market is in contango throughout the terms.
Equities: (SPY, SPX or possibly the /ES) We remain bullish on Equities.
S&P 500 High Yield: (SPHD) We remain 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 had switched over last week to bearish on price, bullish on yield.
Emerging Markets: (PCY, VWO) On Emerging Market Debt prices (PCY), we remain neutral on price, neutral on yield. For Emerging Market Equity Prices (VWO), we remain neutral.
High-Yield: (HYG, JNK) We remain neutral on price, neutral on yield.
Commodities: (GSCI, DBC or GSG) We remain neutral on Commodity Prices as a whole index.
Crude Oil Term Structure: We are firmly within backwardation throughout the forward terms as Fed guidance has rates pushing the forward curve back out. Price is consolidating to pushing higher in the near term.
Crude Oil Specifically: (USO, USL and /CL) We remain neutral on Oil Prices.
Gasoline Specifically: (UGA and /RB) We remain bullish on Gasoline Prices.
Gold and Silver Specifically: (GLD / /GC and SLV /SI) We remain neutral on Gold prices. We remain neutral on Silver.
Currency: ($DXY:IFUS, UUP) We remain bullish on the US Dollar as an Index.
——-
Disclaimer: None of the thoughts or posts at GTC Traders / gtctraders.com constitutes a recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. None of the information providers or their affiliates will advise you personally concerning the nature, potential, value or suitability of any particular security, portfolio of securities, transaction, investment strategy or other matter. GTC Traders simply writes such articles to delineate their thoughts for their own edification; as they allows ones to ‘look over their shoulder’ through such posts. All thoughts posted are simply individual thoughts as to process as of the time of writing, and are subject to change without notification to readers of this website. Stocks and options trading involves substantial risk of loss and is not suitable for every investor. The valuation of stocks and options may fluctuate, and, as a result, any trader may lose more than their original investment; especially in the case of the use of options. Any content on gtctraders.com should not be relied upon as advice or construed as providing recommendations of any kind. It is your responsibility to confirm and decide which trades to make.