The Market Ear with an amusing set-up for equities. The humans have turned bearish. The robots want to buy!
Massive MOVE
Bond volatility has sold off aggressively over the past sessions.
Source: Refinitiv
SPX and bond volatility
We have not seen such a big move lower in bond volatility and SPX not catching bids, at least not in the short term…
Source: Refinitiv
Collapsing VVIX
VVIX continues crashing, leaving the VIX way behind. Dare to trust the VVIX?
Source: Refinitiv
Pensions need to buy
GS estimates: “$29bn to buy ranks in the 89th percentile amongst all buy and sell estimates in absolute dollar value over the past three years and in the 91st percentile going back to Jan 2000.”
Source: GS
Time to get busy
At least if you are looking for the seasonality bull to kick in…
Source: Equity Clock
Still extreme
SPX vs the AAII bull-bear spread. Last week’s reading “nailed” the low, but we are still at very extreme levels.
Source: Refinitiv
Time for mean reversion in oil?
Despite all the narratives, oil has traded inside a wide range for years. We are in the lower part of the range and attempting to take out that short term trend line.
Source: Refinitiv
Another CTA flush incoming?
CTAs are running “healthy” oil shorts….
Source: BofA
SPY vs DAX
Tempting to try that SPY/DAX pair post the brutal collapse in the ratio.
Source: Refinitiv
Largest spread ever
“To put into context how dramatic the rotation out of US and into EU has been…CTAs are now short – $34bn of US equities vs long $52bn of European equities … that spread is the largest we have ever seen by a decent margin” (GS program trading desk)
Source: GS
The market narrative sucks as the Bessent plan of squashing yields is yet to play out, but don’t be surprised if this coiled spring explodes temporarily!
