tag:blogger.com,1999:blog-34323687.post584914327807473670..comments2024-03-29T03:19:56.674+00:00Comments on Macro Man: U-G-L-YMacro Manhttp://www.blogger.com/profile/12324967552369915949noreply@blogger.comBlogger63125tag:blogger.com,1999:blog-34323687.post-36519647940227913212016-01-15T03:32:01.849+00:002016-01-15T03:32:01.849+00:00cheers Ross
i am titillated by the remembrance of...cheers Ross<br /><br />i am titillated by the remembrance of January 2008 expiry<br /><br />market weak all week, they tried to find some footing on expiry day but closed at week low<br /><br />then came Kerviel week end and THAT open on Martin Luther King Monday... while Bernanke was busy grilling sausages and not answering phone calls, SocGen absolutely nuked European indices and sent Globex spoos limit down<br /><br />that 1250 on spoos was such a pivot for so longNicohttps://www.blogger.com/profile/06532015745155347229noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-87820072251479481882016-01-15T02:57:25.628+00:002016-01-15T02:57:25.628+00:00fx in the Asian time zone is remarkably un-fucked ...fx in the Asian time zone is remarkably un-fucked up today by recent standards. One suspects that if the vol sellers who've been lurking in their filthy lairs sniff 3 days of carry from a Vix thats been knocking up against 25 on the hourly charts, then they may emerge to earn their ill gotten lucre and give shorters the poker they have so far avoided. <br /><br />The issue I have with "positioning" for a squeeze though is that its hard to know when to fade it and nigh on impossible (for me) to size appropriately for it. Isn't the higher risk-reward just to play relatives in this environment or scrounge around for upside stops to sell into ? <br /><br />@Nico - really enjoying your posts of late <br /> Rosscohttps://www.blogger.com/profile/18218092677103028057noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-77855082717608003372016-01-15T01:55:16.373+00:002016-01-15T01:55:16.373+00:00Sorry, "Hollywood" Bullard isn't get...Sorry, "Hollywood" Bullard isn't getting any credit or named for some sort of phenomenon. He is like the novice broker or salesperson who looks at the last 2 weeks' price action and extrapolates it ad infinitum into the future. This is the guy that hosted CNBC in the foyer of the St Louis Fed on a payroll day a few years ago. Dude's a joke.Macro Manhttps://www.blogger.com/profile/12324967552369915949noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-36613327004003311092016-01-14T23:29:37.478+00:002016-01-14T23:29:37.478+00:00LB, you are one of a kind.LB, you are one of a kind.Nicknoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-47227134630472467232016-01-14T23:12:56.806+00:002016-01-14T23:12:56.806+00:00No single indicator is perfect, but when several s...No single indicator is perfect, but when several stars are in alignment, one is usually persuaded that a change is imminent. Here is one of many people's favorite contrarian indicators, AA II Bulls:<br /><br />BULLISH: 17.9%; NEUTRAL: 36.6%; BEARISH: 45.5%<br /><br />18% Bulls is a fairly extreme reading. Note that the MM Comment-O-Meter peaked yesterday and declined today. In addition, the VIX made a right hand shoulder. LB often likes to buy on this signal, and the rest of the time he wishes he had waited for it...<br /><br />Since we didn't see blatant evidence that today was a pure squeeze (3-4% up day), we are forced to assume that more than a few participants finally came off the sidelines and entered the fray today on the long side in addition to shorts who covered early. <br /><br />Overall this looks more like late September than August in terms of fear levels [VIX peaked just above 27]. If that's true, then don't be surprised to see vol fall again for 3 weeks or so, or even longer, perhaps as low as the sub-15 level on $VIX.<br /><br />The "Bullard Call" I made yesterday was in jest, but sometimes LB is an idiot savant of the markets as many regular readers are aware (the idiot part, anyway). What an unwelcome prospect the Rising Bullard* must have been for Bears at 7am... <br /><br />*Note to the Management: We should adopt perhaps consider adding the RISING BULLARD to the MM lexicon as a special new form of trading hazard for Mr Shorty, along with COLD STEEL. In English pedestrian streets there are things that come up out of the ground when police/ambulance vehicles have gone through, that are called Rising Bollards. If one happens to be walking along the street unaware when one of these elevates, the results can be quite unfortunate for one's private areas. Recently a friend of LB was unfortunate enough to encounter one of these along Lord Street in Southport while inebriated, and the gentleman has been singing in falsetto for some time as a result.<br /><br />[We await the use of RISING BULLARD as a post title, and perhaps seeing it picked up by the ink-stained wretches of the pink blog, who love to cherry pick quality jokes from around the blogosphere. Go on, you know you love it.]<br />Leftbacknoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-45472255386980358552016-01-14T21:10:17.068+00:002016-01-14T21:10:17.068+00:00I dunno. Not a 3% face ripper heading into the cl...I dunno. Not a 3% face ripper heading into the close, but TLT seem pretty placid, and HYG/JNK aren't getting a lot of relief. It feels like a relief rally to me. I don't have much conviction in that though, and frankly even if I wanted to short this, I'm not feeling too good about the shorting strategies I'm familiar with. I'm sitting tight for now. <br /><br />I think I'm sorta positioned like CV, so not taking extreme damage in my risk assets. But it's all red ink, glad to have a green day to take a breath and figure out how I want to hedge this beast. <br /><br />I hope BnT took profits on his SDS, or at least had a tight trailing stop. <br /><br />I have a small position in mREIT space, glad I'm not the only one wondering why it was being taken to the woodshed. Thanks to the commenters who pointed out it was likely a sector specific technical (cheap funding) issue. <br /><br />I don't like being on the wrong side of LB, Pol, and MM at the same time. So I'll shut up now. <br /><br />Regards,<br /><br />SkyguySkyguyhttps://www.blogger.com/profile/07139541599828256142noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-68909731288866253932016-01-14T21:09:10.638+00:002016-01-14T21:09:10.638+00:00As Dr. Black Swan says, suppressing volatility onl...As Dr. Black Swan says, suppressing volatility only leads to it erupting later on in size. Yet Fed's steady asset base doesn't mean it is necessarily skewed to the downside per se. The fractals look to be expanding to me, everything on a larger scale. Despite it's start, 2016 may end up being a great year for those that know how to trade and a great lesson for those that don't. <br /><br />Those who've recently gotten hooked on the newcrack going though a bit of withdraw today. Maybe I've lost it but selling that seems to offer an interesting risk/reward. Perhaps too much of a gamble..<br /><br />GDX getting close to the Maginot line as well.<br /><br />Bullard right on time. And there are those that say they're out of ammo? Looks like they dont need any at the moment and if they do, a little gee golly I guess we don't need to hike four times, maybe two will do. Take your protein pills and put your helmet on, its going to be a wild year. <br />Coreynoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-27970766550011688872016-01-14T21:00:10.159+00:002016-01-14T21:00:10.159+00:00" like the inability of Bunds to move below 0..." like the inability of Bunds to move below 0,50%"<br /><br />Yes, yes, yes ... another nice one for the punters to chew on. My bet; its going to 1.3%. We just need to father Draghi out of the way next week, and the runway will be clear. It will the FI trade of Q1 I think. <br /><br />CVhttps://www.blogger.com/profile/16843402165210120665noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-9730294567572876882016-01-14T21:00:00.665+00:002016-01-14T21:00:00.665+00:00We are thinking about staying long but slapping on...We are thinking about staying long but slapping on a few hedges for next week's post-expiration trade. Let's see what price action tomorrow brings, but if Price is News, the news is better and the rally was a constructive one and not a textbook bear market rally/squeeze. We'll see.<br /><br />A monster move up in BP today, that was telegraphed by the stock trading well even amid yesterday's carnage...Leftbacknoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-35011444881643019022016-01-14T20:55:57.828+00:002016-01-14T20:55:57.828+00:00After having moved to benchmark last friday (buyin...After having moved to benchmark last friday (buying), we have been sitting tight this week watching the events unfold. Key levels are holding so far, but it is probably too early to call the all clear. Today we are reducing the exposure in Nasdaq, while switching into Brasil (unhedged). The resilience in EM has been surprising indeed like the inability of Bunds to move below 0,50% ... Which I find very telling.<br /><br />On a longer term picture I like to look at the S&P500 monthly chart with 10 and 20 simple moving averages: if things do not change dramatically between here and the end of January we will see a bearish crossover with the monthly close. This will change our strategic setup to a structural and probably significant underweight in equities by selling into the strength which we will hopefully see towards the end of Q1-beginning of Q2 ..... Now, this is the A-Team plan, but I admit that timing can go awfully wrong and it is therefore uncertain and subject to a very close scrutiny.<br /><br />On FX, I notice that one of MM's darlings (AUDNZD) is carving out a nice chart and looks nice on the long side. I also like short EURNOK, Norges Bank permitting ....ALnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-70283779532442644662016-01-14T20:53:15.655+00:002016-01-14T20:53:15.655+00:00Dare we stay long over the 3-day holiday weekend a...Dare we stay long over the 3-day holiday weekend after tomorrow's continuing rally?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-25010753193687287272016-01-14T20:28:46.662+00:002016-01-14T20:28:46.662+00:00@LB:
Casino Royale [9s] video: https://www.youtu...@LB:<br /><br />Casino Royale [9s] video: <a href="https://www.youtube.com/watch?v=9VaoX6X9l8Y" rel="nofollow">https://www.youtube.com/watch?v=9VaoX6X9l8Y</a><br /><br />Thankfully, I am not enduring such pain today. Next week is another story...MrBeachnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-62579793255394511812016-01-14T20:23:25.857+00:002016-01-14T20:23:25.857+00:00It was a classic early puke and capitulation botto...It was a classic early puke and capitulation bottom today, followed by a scramble to cash in the winnings ahead of expiration. Now we can only state that this must be very painful to those unwise enough to try to re-establish shorts during the day. We have been waiting a while for this, but we can now state unequivocally that it is definitely COLD STEEL time for Mr Shorty... Leftbackhttps://www.blogger.com/profile/07728096415928915882noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-34020216601135035452016-01-14T19:59:17.659+00:002016-01-14T19:59:17.659+00:00The machines were really nasty today with TWTR dow...The machines were really nasty today with TWTR down to 17.27, now 19.08, GOOGL touching low of 705, now 739... i can go on, but you get the picture. Capitulation. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-71552621377321337322016-01-14T19:48:41.368+00:002016-01-14T19:48:41.368+00:00Well, good to see that we're all getting along...Well, good to see that we're all getting along now. Bandages are being applied slowly but gently up here, and we await the "follow-through" in Europe tomorrow with some, erm, anticipation. <br /><br />"It is a fact that a monstrous 3% ripsnorter in Spoos is not a mark of a healthy market, but a characteristic of highly volatile bear markets, a fact pointed out by Barry Ritholtz among others in 2008. "<br /><br />Well yes, that is the point isn't. I mean, I think we all agree that oil puts on its running shoes here, the whole risk asset complex could have a mighty fine Q1 in the end. But is it a rally to be sold/reduced into? Inquiring minds want to know. <br /><br />Of course, I have my eye firmly on the U.S. 5Y here and as long as that sits in a range, I will remain in the mindset that the path of least resistance is choppily up. Did buy a tad of Rep today ... looking nice for a break and a countermove. Elsewhere, has anyone else noticed that EM has been trading oddly resilient. Suddenly no-one is talking about the turds of turds anymore, now that Spoos have had a date with gravity, funny that ;). CVhttps://www.blogger.com/profile/16843402165210120665noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-63257701526715629522016-01-14T19:40:46.164+00:002016-01-14T19:40:46.164+00:00Ditto.
Nico - MUCH respect.Ditto. <br /><br />Nico - MUCH respect.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-70370811247974888332016-01-14T19:25:55.769+00:002016-01-14T19:25:55.769+00:00It's less Pear-Shaped today, and more V-Shaped...It's less Pear-Shaped today, and more V-Shaped. <br /><br />It's important to watch the action in these retracements. Although a vicious squeeze of the face ripper type can be amusing to market participants and profitable to many such as ourselves who enjoy these things, it is a fact that a monstrous 3% ripsnorter in Spoos is not a mark of a healthy market, but a characteristic of highly volatile bear markets, a fact pointed out by Barry Ritholtz among others in 2008. So if we see a 1.5-2% up move today that might say "V-shaped recovery", but a 3.0-3.5% rip might send a different message that would confirm that this market has adopted more bearish characteristics.Leftbackhttps://www.blogger.com/profile/07728096415928915882noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-55455579818982692112016-01-14T19:17:50.874+00:002016-01-14T19:17:50.874+00:00Well Nico is a contrarian, which means if he is ri...Well Nico is a contrarian, which means if he is right, he wins big. Of course it might mean that he was wrong many times before. <br /><br />But he has been correct more than anytime since last year. So it says something about this market.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-76428974411911877812016-01-14T19:07:29.458+00:002016-01-14T19:07:29.458+00:00Nico ... thanks very much for your response and al...Nico ... thanks very much for your response and all your commentary over the months & years. I for one have always enjoyed reading your missives/views, and really don't understand why you get an inordinate amount of grief from some of the punters out there. In this business there is ALWAYS a difference of opinion, but that is precisely why I come to MM's superb blog ... to learn and learn! Anon444Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-16843349457124818182016-01-14T19:05:54.299+00:002016-01-14T19:05:54.299+00:00@Anon 4:44 on the "you shouldn't spread E...@Anon 4:44 on the "you shouldn't spread Europe US". Nico's logic is spot on. However, if you're a simple simple punter, he means buy one and sell the other e.g. Buy Eurostoxx and sell Emini.<br /><br />You could be buying Europe for ECB QE and selling US for FED tightening. Sounds simple but it can hurt big time, as explained by Nico. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-19940293106591476382016-01-14T18:12:52.645+00:002016-01-14T18:12:52.645+00:00Anon 5:44, a young "professional trader"...Anon 5:44, a young "professional trader", perhaps? 25 year old quant and Econ PhD who recently learned to shave? <br /><br />Listen, Snowflake. We are all f*cking gamblers here, that's why market participants are referred to as "Punters".<br />Now, Look and Learn!<br />Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-40128893503040123502016-01-14T18:12:43.998+00:002016-01-14T18:12:43.998+00:00Guys, disagreements are allowed nay encouraged, bu...Guys, disagreements are allowed nay encouraged, but please try to keep it civil. Thanks.Macro Manhttps://www.blogger.com/profile/12324967552369915949noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-55483222351498432682016-01-14T18:09:08.367+00:002016-01-14T18:09:08.367+00:00Now now, children, play nicely or Uncle MM will ha...Now now, children, play nicely or Uncle MM will have to take your posting privileges away. Wish the Anons would simply use a handle so we can tell which anon has been tearing us a new asshole. In any case, we wish the gloating Anons all the best, especially if they didn't cover yesterday (I am sure B in T did). Your welfare is obviously important to us.. :-)<br /><br />Yesterday was an interesting one, the MM Comment-O-Meter was off the hook, yo, which as MM pointed out has been a major indicator of short-term lows and market turns for some time. The LB-Abuse-O-Meter and Gloating Anons Index were also reading at levels we haven't seen since 10y kissed 4% in 2010 and LB went long TLT to howls of derision. Just sayin'...... In this case the trade everyone thinks is mental is long XLE, where of course everyone and their Uncle has been short.<br /><br />LB's trades du jour are XLE calls and TLT puts. Yesterday's action was indeed feckin U-G-L-Y, but the morning has delivered a more sober view of the market to many participants. Late in the afternoon we were tempted to post this again but we were watching the match. It's a tune we have brought out many times on fairly desperate liquidation days. "When the Demon is at your door, in the Morning he won't be there, no more..."<br /><br /><a href="https://www.youtube.com/watch?v=sEfNWc1UNjM" rel="nofollow"> Any Major Dude </a><br /><br />As several observers pointed out here, yesterday was an odd one. FX didn't budge, rates didn't exactly explode to the down side, and it was a classic case of Correlation Breakdown. Regular readers will know that FX/equity correlation breakdowns often signify market turns and/or FX regime change. It would certainly be fun to go back to USD down/EEM up, for example. That's the kind of crap we can trade. Today we see USDJPY firmer but that old standby AUDUSD is in lock step with equities. Overall we are much more comfortable with what we are seeing today, and yes we do think a face-ripper is lurking out there.<br /><br />In any case, we'll let DInah Washington bring the song of the day to all readers of MM.<br /><br /><a href="https://www.youtube.com/watch?v=OmBxVfQTuvI" rel="nofollow"> What A Difference A Day Makes </a><br />Leftbackhttps://www.blogger.com/profile/07728096415928915882noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-26648376691618774532016-01-14T18:07:38.379+00:002016-01-14T18:07:38.379+00:00"you're sounding like someone with a gamb..."you're sounding like someone with a gambling fix, not a professional trader"<br /><br />oh dear, another one of those beginning punters who think there is an actual difference because they read samuelson in econ 101. How adorable.washedupnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-53120068117635206002016-01-14T18:05:57.176+00:002016-01-14T18:05:57.176+00:00meaning you end up too short the leg outperforming...meaning you end up too short the leg outperforming against you.Nicohttps://www.blogger.com/profile/06532015745155347229noreply@blogger.com