Our comments surrounding the vagaries of the note this week.
At the moment, I have commented that I am evaluating data on the Inflation front. Discovery Trading Group has tweeted some interesting comments on the OIS and Swap Curves that I think are of note, to give a more well rounded picture. And we also discuss the discretionary portion of systematic-discretionary.
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: 7:50 AM EST – Building Permits
10:00 AM EST – New Home Sales
Tuesday: 9:00 AM EST Case-Shiller Home Price and House Price Index
Wednesday: 8:30 AM EST – GDP
Thursday: 8:30 AM EST – Core PCE and Personal Income and Spending
Friday: 8:30 AM EST – PMI Manufacturing
SOFR Yield Curve: Up to the end of 2024, in the last week we have moved to higher yields, lower prices; while in the middle of a range that began in September. In 2025, we were range-bound for the week, but have now moved settled at the higher end of the range of lower yields, higher prices.
Treasury Yield Curve: Inverted.
In the front of the curve near the 2’s, we had moved to higher yields, lower prices. However, Across all terms, we have now moved to the highs of last week in terms of price, or lower yields, within that range.
Overall Risk: (Stock Indices, Gold, Long Bond, Bills): Overall Risk, we remain “Bullish” general, broad, overall bias.
Equity Volatility: (VIX) We are at 12.68 and +0.23 at the moment on the day. We have volatility that I would rank as cool.
Equity Volatility VIX TERM STRUCTURE: Normal conditions in Contango and nothing popping off to alert us. A bit of a bounce here though, would not surprise me.
Equities: (SPY, SPX or possibly the /ES) We remain neutral 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 remain neutral on price, neutral 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 bearish on Commodity Prices as a whole index.
Crude Oil Term Structure: We’ve moved a bit here. The front terms still tend to indicate a BIT of backwardation. But only a bit. It’s easing. When you look down to more distant terms for Oil, you find that the Backwardation that we have been experiencing in the last few month, is easing, and completely falling off farther down the terms. As mentioned last week, backwardation was easing. Price, has led the way.
Crude Oil Specifically: (USO, USL and /CL) We remain bearish on Oil Prices.
Gasoline Specifically: (UGA and /RB) We remain neutral 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 bearish on the US Dollar as an Index.
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