like kittens in a box
market vibes
April 30…)
“I'll have you understand I am running this court, and the law hasn't got a damn thing to do with it!” Sam Ervin, Watergate 1974
In the news
Trump took a page from the nostalgic days of the 2024 presdidential campaign and rallied voters in Michigan for 90 minutes yesterday. Nothing new in the format but a lot of reality in content as he memorialized his historic blitz and mocked the utter devastation of his political opposition.
Bloomberg opined: (I paraphrase): “tariffs imply a (consumer products) supply shock as China reduced the number of container ships to America.” Fwiw… China doesn’t ship rare earth metals, sophisticated military weapons, and critical medicines in container ships. They ship cheap machinery, cheap electronics, clothes and so forth; things we plan to make here. And if they don’t send them they don’t sell them.
Super Micro fell 15% after results miss estimates, UBS delivered a beat, Spain’s grid operator says, “Not my fault.”
As for data this morning another heap of irrelevant busy work which seems to be coming in bulk this week. Yesterday’s data was generally soft with retail sales and consumer confidence a bit below survey, House prices were seady and JOLTs fell in both openings and quits. I expect more of the same today. The data is slowing faster than the economy. CORE PCE prices may be lower than survey, imo.
Just a hunch. Thinking bonds.
In the markets
Starting with bonds this morning, prices are a bit higher on extremely light volume and motionless open interest. Whenever prices are moving in a well-defined auction (up or down) and open interest is not moving, one side of the open interest is not participating. In this case, the longs.
Prices are rising in bonds because shorts are covering from shorts who lose money and pay up to new shorts to get out. Longs are not selling, so OI stays unchanged. If, when, new longs come in, new sellers will fill them, and OI will rise. If the rise in OI is big, we can then easily identify the entry price of the position and keep an eye on who is winning and losing going forward. For now… the longs are winning. If they remain anchored, that’s bullish.
Gold prices are consistently rejecting the POC ca $3340, and we have a down wedge forming near the $3270 lows. It seems sooner or later the isolated high from last week, sitting on top of a down wedge and a weak metals sector, will impose a serious test of the mid-3200s in gold.
But gold is a tough customer, Lol…it could be brief.
next up this morning, Copper in vertical decline, the dollar a touch higher, stocks at the starting line, lower oil (again), a very steady bitcoin at the highs… and the world turned upside down in the vibe. Here we go…
