evening wrap

market vibes

January 8… )

“Employers don’t pay wages. Employers only handle the money. It’s the customers who pay the wages.” Henry Ford

Traders spent the day watching L.A. burn to the ground. Apart from that stunning tragedy, the news was predictably dull. Panama said China doesn’t control the Canal. Canada is a proud nation, yada yada… Fed minutes, were mellow.

ADP came in weak: 122k vs. 140k survey. And although ADP is more credible in its approach, no one cared. If algos don’t trade the data, it doesn’t exist. NFP is expected at 165k on Friday.

Initial claims surprised with a dovish miss: 201k vs. 215k, the lowest in a year and downright recessionary… yawn.

DXY was higher on trend (next chart), probably because the long bond pays foreign lenders nearly 5%. Although no one is saying the quiet part of this bull move, the dollar is Powell’s most effective ally… very expensive, but effective.

The Yen and CHF made new contract lows on the CME but barely by a dribble and a trickle. Canada fell back to its pre-Trudeau levels. Euro and GBP futures had the narrowest ranges I can recall in many months.

Fixed income and Bessent, then gold, stocks, bitcoin, natty and The Vibe up next: