Citius, Altius, Debilius: Dip-Buyers Rescue Tech-Wreck As Rate-Hike-Odds Soar
If the market is to be believed, Fed rates are going higher, faster, and sooner than anyone expected… while the economy (and the market) are weaker than most expected and inflation dramatically higher than every establishment groupthinker could imagine…
March rate-hike odds are over 90%…
Source: Bloomberg
And the market is pricing in 4 rate-hikes this year…
Source: Bloomberg
All of which combined to send stocks down on the day, but that wouldn’t last! Today’s BTFD bounce came at the Nasdaq 200DMA and coincided with JPM’s Kolanovic urging its clients to BTFD once again… Nasdaq recovered from a 2.7% intraday loss to close green
Nasdaq was down over 7% YTD at its lows today (and Small Caps -5% YTD)…
The Nasdaq bounced at its 200DMA today…
After it briefly entered into ‘correction’, down 10% from record highs…
“…the music is about to stop and we’re going to be left holding the biggest bag of odorous excrement in the history of capitalism…”
Unprofitable tech stocks are down 48% from their record highs…
Source: Bloomberg
Banks recent surge stalled modestly today relative to Tech…
Source: Bloomberg
Notably bank stocks have seriously outperformed the broad market, and decoupled from the yield curve…
Source: Bloomberg
‘Recovery’ stocks weakened today to their lowest relative to ‘Stay at Home’ stocks since the vaccines were approved…
Source: Bloomberg
Even as cases and deaths decouple dramatically…
Source: Bloomberg
Mixed bag in bond-land today with the short-end sold and long-end bid…
Source: Bloomberg
Which sent the curve flattening, erasing Friday’s rate-lock-buying driven steepening…
Source: Bloomberg
The Dollar bounced higher during the US day session…
Source: Bloomberg
Bitcoin broke below $40,000 today but found support…
Source: Bloomberg
Bitcoin is the most oversold since March 2020…
Source: Bloomberg
Ethereum broke down below $3,000 but found buying support there…
Source: Bloomberg
Oil prices slipped modestly today with WTI back down to $78…
Gold pushed higher today despite the stronger dollar, with the barbarous relic back at $1800…
Finally, if the relative price of growth to value adjusts to the reality being priced into real yields, the bloodbath in big-tech is far from over…
Source: Bloomberg
Now that might be a big enough dip to trigger Powell’s new put-strike, and financial conditions are tightening…
Source: Bloomberg
How is that red line going to reassure stock-dip-buyers… unless Powell folds like a broken lawn-chair?
Tyler Durden Mon, 01/10/2022 – 16:01
