evening wrap

market vibes

April 2… 8:40 PM EDT)

“Flat is a position.” Adage

A very brief checkdown of charts at 6 PMish and later in random order:

CNH ripped through 7.30. China's going to let Yuan fall, but Trump was clear if that happens, he'll adjust tariffs higher. We'll see how that goes. You fight wth the weapons you have.

CME Yen futures are a bit higher. With stocks down sharply, reshoring Yen to Japan seems likely. Will that shake up the carry?

There is a very big spec long position in Yen futures. You can see it was the opposite in July when stocks topped. The crash came 3 weeks later and the long position in Yen was already vertical. I don't see a correlation to last summer, but I do see a very crowded long in Yen futures.

Bonds broke the top of the Q1 range and just missed the Q4 highs. In longer time frames, OI is still very high, putting some older short positions in debit.

Stock indexes gapped lower at 6 PM. The Nasdaq (chart below in weekly data) is accelerating down, but we still have 2 days left for weekly data to settle and NFP Friday. So, hold the phone.

One of the side stories in stocks today is an antitrust suit vs Meta due in court circa April 15. Apparently, Zuckerberg's pleas to Trump for a delay fell on deaf ears today. Why should Trump cut him a break? Zuckerberg spent $400 million aiding the party that wanted to put him in prison for life.

Meta went into the announcement down $20. Down $30 as I write. The narrative is Trump's next move is going to be to break up the monopolies. You know he will. The Mags are going to be badly mauled, I think. But there are always stocks to buy, just not the covid darlings.

Oil fell 2 dollars/barrel. There is nothing fundamental happening in oil yet, but there's been a lot of bullish talk this week like “the US oil patch can't survive under $60/barrel”, etc.

You know they can. Oil companies are just as artful as anyone else when they know they're holding the cards, and Trump wants oil down enough to make them a deal they can't refuse. In my opinion. When they get it they will fill the tanks, imo.

Copper was down .20 cents on the lows. This is crazy. We need copper, and China has all the free float. I don't see copper staying down.

Everything was sold hard except gold.

Prices were whippy, but compared to everything else, gold was like a rock. That doesn't mean it won't be down a hundie in the morning, but I wouldn't sleep well if I were short.

Last but not forgotten, bitcoin in 30 minute data without comment…

My vibe,

The markets were pretty well flushed before this tariff tantrum. I'd like to throw caution to the wind and buy everything, but I do not have to do it tonight. Gold had every opportunity to shake the longs out, and it held well. In this form, not going down is going up.

What we have seen this afternoon was the weak side of every market. Stocks went down. Bonds went up. The dollar went down. Gold did not go down, and gold was the only market that went into the announcement on record highs. Still. Nothing is safe.

"The game's afoot." Shakes… Henry V

Good luck in Asia!

JJ

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Charts and data CQG and Bloomberg

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