Q2 start, looks over range out of the gate, selling pressure

energy is currently sorting itself out and gold as well

the bond dip may be an opportunity

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there is some reluctance due to slowed expectations for rate cuts

commodities seeing green, crude and rbob, palladium (cats)

precious metals really pumping with vix, alas not crypto

indexes and bonds are feeling the heat, forex is wild

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also suspecting with the dipping that bonds might be supported regardless

seeing carries like aud/jpy and eur/jpy react positively.. indexes may not be that far behind on this dip

energy and vix are extended and just riding along toward the inevitable nfp.. more like accessories vs main event

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so noticed that longer term yields rose more vs. notes and bills and that indicates bear steepening

longer dated is sold for shorter duration in anticipation of rate adjustments

the opposite would be short term dropping more as bull steepening

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kinda similar to backwardation, where holding on results in lower prices on the next contract

so a bear steepener instead hides in the shorter end to collect lower yield but with less vol

or if vol were in contango then maybe holding premium might be worthwhile .. and yes vol is until elections

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altogether plotting we see that the contango rises faster for 10y v 30y from sep to dec 24.. and the contract starts 3 mo ahead (expiry date)

so then.. summer / q3?

the latent vol has provided cloud cover for entry

carries did give an early all clear signal confirmation

and the levels were appropriate for a confirmed setup today

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going into Q2'24 earnings, we expect continued strength

energy is an annoying tailwind but part of the package

also an eye on dollar and inflationary adjustments / effects

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there is still some latency and pressure into nfp so tbd

looks like the front run has been established in indexes and vol

so the nfp data would be just a confirmation to this advance

the missing piece is bonds which will likely follow a delayed path

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as a clue, energy is interesting and is propped enough but is paused

would be interested in whether crypto and gold would pop as well

all understandable into nfp and carries as well

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the carries look close to saturated and any negative result would reverse

they were one of the first to signal the turn in trend and possibly again

dollar / forex behavior, so would not be too exuberant going into the frontrun

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individual sectors, semis seem coiled and possibly mag7 at the inflection

googl seems saturated and less responsive, meta amzn msft really pushed

nvda and aapl coiled, smci too.. decent 50/50 on indexes so maybe 1/2 off

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confounding factor hit with news events so now just on pause

levels shifted patching over weakness (already baked in)

event seems to override any incoming data

vix also up hopefully passes along with crude

indexes might float further if carries can hold the line

yields seem to just slowly fade but steady, dollar as well

rbob seems to be waning, helping lower inflation

gold and silver may but still needs to fade out

carries seem ok, longer yields dropping more

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these nextgen disruptors are very real

language ai is both a contextually relevant processor and a content extractor (you provide search data to the interface similar to google)

automation, robotics and particularly electric vehicles are edging closer to primacy like it or not

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there is a theme for simplicity, avoiding redundancy and improving scale.. sort of moore's law but on civilization itself..

here's to hoping we are on the base end of an exponential liftoff

elections could be decided based off of such issues instead

the burst from the dollar is pushing usd/jpy as well

an attempt to tame commodities but likely needs more

bonds still in the nono zone pulling down harder

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charting case schiller 20-city composite

there was attempt to break support last year

that attempt may re-surface as well this spring

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watching buyers take in the higher yield loans

something like ~20% premium for buying in

then a drag lower with the supply pressure

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minneapolis seems close to a break

detroit / phoenix less healthy vs miami

quick estimates default to pre-2020 prices

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going after housing as a large inflation factor

likely one of the closely monitored tenets for the fed

perhaps the equity loss can be washed by indexes eventually

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warnings were served but buyers still entered

and this is the likely aftermath and path forward

maybe the excess will repair generational imbalances

nice drop in energy, indexes trying

yields unknown to diverted to indexes

and vix is making an attempt but rejected

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entry first in nq which led

followed by es, rty and ym lagging

and took off after hitting unexpected levels

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solid rebound

usd/jpy as a carry is just pending

energy never had a chance to really develop either

also stalled from financial earnings kickoff

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usd/jpy and other carries are signaling early recovery

energy reverted after bump failing a break possible revert

gold is similar outside channel and needs to rest for buildup

almost as if.. we are united in a war against inflation

other wars are less important

and inflationary in the wrong manner

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then from ww2 > viet / kor > cold > proxy > cooperative relations

neither fronts have interests that supercede fighting inflation

as the most devastating is economic warfare affecting all involved

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went out of their way to define the risks, introducing certainty

certainty is great. vol is taken out, risk-off commodities too

inflation fizzles further and we can continue our path fwd