never say never
market vibes
May 7…)
“There's no chance that the iPhone is going to get any significant market share.” Steve Ballmer 2007
FOMC at 2:00 PM EDT
In the news
For approximately 50 milliseconds at 6 PM EDT yesterday, the markets dipped and ripped as a news release was contrived to perfectly coincide with the Globex opening: A meeting was booked in Switzerland next week between Bessent and Chinese tariff negotiators. Since that instant in time, about equal to the blink of an eye, prices have hardly moved at all.
The Philippine central bank Governor Eli Remolona signaled that authorities are unlikely to intervene to curb the strength in the peso (BBG). The Singapore Straits Times opined, “The US dollar may face a US$2.5 trillion “avalanche of selling” as Asian countries unwind their stockpile of the world’s reserve currency.”
Imo…They could dump their trade surplus dollars. But they might also swap them for Treasuries if Bessent made them a deal they couldn’t refuse.
India and Pakistan are skirmishing again. So far, 5 Indian aircraft were shot down, 26 Pakistanis are dead (AP), and their stock markets have weakened. This morning, India conducted “targeted” attacks, and Pakistan retaliated. The knock-on implications for us would be gold and silver if things escalate. They both have nukes.
The PBOC cut rates and injected liquidity overnight.
In the markets
Gold and silver are both lower as FX markets and tariff tensions eased overnight. Open interest rose approximately 12,000 lots yesterday as of preliminary COMEX data, indicating 1.2 mm toz of new length in futures.
Everything is in USD FX is hyper sensitive which so far has been developing horizontally at the bottom of a steep downtrend, so as usual we ask, “Are strong hands distributing risk to weak buyers or accumulating risk from weak sellers?”
In long time frames, DXY is trading horizontally as well. The same analysis is appropriate. Will Asian USD trade surpluses buy US Treasuries? If not, what will they buy? Gold? maybe in part. China (I doubt it). TINA still favors the buck.
Since it’s likely to be a quiet day of waiting for the 2:30 press conference, I penned some deeper thoughts on oil, stock indexes and bitcoin this morning. And a hopeful turn of the cards in the vibe… here we go.
