UbiK @ubiktec

@aurelius28 @jbulltard1 We can start a list of SPCX promises

Market Insights with The Carny – October 13, 2025 (Please like, RT and comment if useful, thank you!) Shortly after Trump tanked the market following the close, likely not realizing the futures markets were still open, a wave of instant damage-control measures came from both the U.S. and China. Both sides seem intent on calming the waters. While neither will openly take blame for the escalation and both will keep talking tough, it’s clear that neither wants to ramp up volatility right now. There’s always the crowd that says “China plays the 100-year game” while the U.S. is short-term focused, but China is currently dealing with a wave of housing trouble and financial stress. It’s not the same country it once was. China has effectively become a first-world nation, and its people now expect a level of financial success that can’t be smoothed over with factory jobs or a few government handouts. The idea that the government has total control and can just detach itself from the ROW is silly and the population will have no part in that. That said, the U.S. is often too short term focused and has a habit of sticking its foot in its mouth. The fact that the U.S. has little access to so called “rare earths,” which aren’t actually rare at all, is absurd. The real issue is refining capacity, something the U.S. government in all its wisdom failed to invest in. It’s a total farce and a clear example of poor foresight. In this area, China has outmaneuvered the U.S. and now holds a much stronger hand. So what does that mean in the short term? The same thing almost all geopolitical scares do. Earnings aren’t hurt, the AI bubble is still intact, there’s no reason for earnings to fall off a cliff, and no one is going to start laying people off because Trump went off on Truth Social. It’s the same kind of rant we’ve seen a thousand times since 2016. Why people lose their minds every single time is beyond me. Pattern recognition clearly isn’t being taught in public schools anymore. Would I buy the dip today? No. Although assets like Oil were hit too hard and I did play that bounce on Friday, the fact remains the market is due for a correction. This is as good a reason as any to lighten up on risk. The market was clearly extended, and this washout made sense. I wouldn’t short, as there’s been no real change in the economic or earnings backdrop, but I also have no intention of loading up long. I’m doing nothing beyond playing a bounce in commodities, since both outcomes... a prolonged trade war with countries restricting key resources, or a calming of tensions... should be supportive for the sector. Doomers never win, and even if they eventually do in the grand scheme of history, the small gain in portfolio PnL won’t matter. At that point, we’ll be eating rations and taking anti-radiation meds instead of worrying about our 401(k). All jokes aside, this is a great time to expel excess risk from your portfolio, not add to it. Be smart, use this bounce as a gift to adjust your risk levels, and get ready for the end of the year. ---------------------------------------------------------- If you’re interested in this type of market analysis, check out our premium service at @DSMMAprivate. We offer quantitative models, market briefings, technical setups and indicators across a variety of platforms. Link in Bio or DM me @NikLentz ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly ---------------------------------------------------------- == Preparation Beats Prediction == ---------------------------------------------------------- Good luck and God Bless! - Nik "The Carny" Lentz

Market Insights with The Carny – March 5, 2025 (Please like, RT and comment if useful, thank you!) There were no major shocks as Trump addressed Congress in the longest speech of its kind last night. Yesterday's tariff release triggered a broad panic across all assets—a classic washout that often signals a good opportunity for dip buyers, and yesterday certainly delivered on that front. However, near the close, sellers came in aggressively even without new news, which is atypical after such an intraday bounce and indicates lingering panic. This morning, we’re trading higher. Many attribute this lift to Lutnick's comment that tariffs could be adjusted as soon as today. I suspect it's a mix of that and traders who panic-sold at yesterday's close, fearing new developments, and then tried to grab back the dips they bought too early once nothing materialized. ---------------------------------------------------------- Stock Market Outlook: The C-MAPE score is in the 2's, and intraday we pushed to the lowest level since the COVID panic. This extreme reading typically signals a near-term washout. The CC scores also hit an extreme near the lows, with one thing holding firm—the SPX breath remains to the downside, but not at an extreme level. Overall, yesterday was a good time to buy "value." I picked up AMZN for both my alpha and personal accounts, added to some of my favorites like CNX, closed my most recent tip buys up nearly 5%, and shifted some cash from my longer-term accounts into more typical equity risk positions. ---------------------------------------------------------- Bond Market Analysis: Bonds are essentially a no-touch here. They've moved with an extreme push to the upside as players were forced to account for an economic slowdown that, for whatever reason, they pretended wasn’t there. Add in some panic stock selling, and you get a rapid, brutal re-evaluation of prices across all STIR and bond curves. In a reasonable environment, this would be the time to start evaluating some shorts, but it's too dangerous as players try to get used to the idea of tariffs. One thing to stress is that tariffs are as old as time. While businesses in the short term have, and will continue to, pull back on spending and growth, after the initial shock they will return to normal. Inflation is not a real fear in the economic slowdown we have entered; combined with the one-time nature of tariffs, general prices may rise, but "inflation" will hold steady. This kind of wordplay can (and should) frustrate players, but we don't get to make the rules. I would avoid any alpha strategies in bonds currently and trim long-term TIP positions while holding the bulk of the yield we've acquired over the last couple of months. ---------------------------------------------------------- Currency Markets: FX is definitely back, and with it I took a long in USDJPY after being short for months. This is just a trade and my long-term view remains unchanged; however, just as tariffs hit the market, strong dollar selling ensued. The DXY has corrected sharply to the 105 level, and while I’d expect it to trade in the 104-106 range over the long term, this move seems excessive in the short term. I want to be long dollar plays, and with the EUR touching 107 this morning, I see a chance to add some short EUR to the alpha mix. I'll keep everyone informed, but in general, I like long dollar plays over the next few weeks. ---------------------------------------------------------- Commodities Market Analysis: There are many ways to skin the proverbial cat, and many are trying to play oil based on rig counts, producers talking about prices being too low, and other micro factors—while ignoring the BIG picture. The facts remain as stated: OPEC's smaller players want to pump, Trump wants oil lower and will do whatever it takes to keep oil under $70, producers' break-evens are lower than they claim, and technology never stops evolving—making oil less important and easier to find. This is a bad backdrop for extended price rallies. However, if oil drops to $65 in the near term, that would be "too low" and at that point a dip could be buyable. Gold continues to be in full FOMO mode. If inflation comes in high, buy gold; if the economy slows, buy gold; war? Buy gold. This can't continue forever, but as I've said many times—whether it's tulips, tech stonks, or gold—once you enter a phase like this, it's useless to try and fight it. It appears to want to touch 3k. BTC came back after the panic buying, then experienced panic selling, and is now back to buying. In the long term, the case for BTC is hurt by strategic reserves and the loss of another buying "narrative." I would avoid dip buys for now and wait for the 70k touch. It appears to be headed there, but who knows what path it will take. ---------------------------------------------------------- VIX Term Structure: With the VIX curve shifting into backwardation, the spreads are extremely blown out to the downside in the short term and the flys are negative—generally indicating that traders are closing out hedged positions. However, if people have to reach for protection again, that's when things can get truly ugly. You should never bet on a crash; in fact, you should always bet against it, though the window is still open. Could this be the big one? Sure. But betting on "big ones" is a losing strategy over time. ---------------------------------------------------------- TL;DR Summary: - Daily Briefing: Tariff news caused a broad market washout yesterday, with aggressive end-of-day selling indicating lingering panic. This morning’s lift appears driven by tariff adjustment hints and traders re-entering after panic selling. - Stock Market Outlook: Extreme readings (C-MAPE in the 2's, CCS at extremes yesterday) signal a near-term washout. With ES down about 5%, NQ around 10%, and RTY at 15% from their highs, dip buying looks promising over time, though short-term momentum remains uncertain. - Bond Market Analysis: Bonds experienced an extreme upward push as traders accounted for an economic slowdown they initially ignored. While this would normally be a short opportunity, the ongoing acceptance of tariffs makes it too risky. Avoid new alpha plays in bonds and trim long-term TIP positions. - Currency Markets: The dollar remains weak after the tariff drama, making long dollar plays attractive. There's potential for a short EUR play if it breaks out to 107, and USDJPY looks like a viable short-term play for dollar strength. - Commodities Market Analysis: Oil has broken support and is expected to consolidate between $67–$72, with fair value near $69–$70; a dip to $65 would be buyable. Gold remains in full FOMO mode with potential for a rally toward 3k if key levels hold, and BTC you should hold out for a 70k touch. - VIX Term Structure: The VIX curve is in backwardation, signaling an exhaustion phase with traders closing hedges. While this opens a short window for potential crashes, betting on a big one is not a winning strategy over time. - ------------------- If you’re interested in this type of market analysis, check out our premium service at @DSMMAprivate. We offer quantitative models, market briefings, and technical setups. Link in Bio or DM me @NikLentz or @Jimmyjude13 to get started. My market notes and breakdowns on Twitter/X will always remain free. The paywall is for those seeking deeper insights and private attention to excel in the markets. ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly ---------------------------------------------------------- == Preparation Beats Prediction == ---------------------------------------------------------- Good luck and God Bless! - Nik "The Carny" Lentz

Market Insights with The Carny – Feb 11, 2025 (Please like, RT and comment if useful, thank you!) The news was light last night as Trump implemented the telegraphed steel tariffs—a largely non-event. More interesting is the reciprocal tariff plan coming out in the next two days, which I feel is a big deal that people aren't paying enough attention to. Regardless of your views on Trump, a simple rule that sets tariffs at the same level that other countries impose on the U.S. is not only easy to follow, but it's also a lot closer to "fair" than tariff by tweet. It's great for the Trump administration's PR. Very few people know that the UK tariffs cars at 10% while the U.S. sits at around 2%... or that France tariffs wine at 25%. Don't even get me started on China. With this rule, tariffs can increase to match—or even decrease together. It's hard to see how that won't be a popular play. After the initial shock (as it's a "Tariff!" moment), people will relax, and other countries will be a lot quicker to play ball since they have little defense when it would be their country imposing tariffs higher than those in the U.S. This will cause a relaxation in fear across the board and is hardly inflationary. A simple ruleset is good for everyone. ---------------------------------------------------------- Overnight News - President Donald Trump substantially raised tariffs on steel and aluminum imports on Monday to a flat 25% "without exceptions or exemptions", affecting imports from Canada, Brazil, Mexico, South Korea and other countries that had been entering the U.S. duty free under the carve-outs. (RTRS) - Trump said he would announce plans to impose reciprocal tariffs on other countries over the next two days, doubling down on comments he made on Sunday. (RTRS) - Trump said he had spoken to Chinese President Xi Jinping since taking office on January 20, but did not offer details on the topics of their conversation. (RTRS) ---------------------------------------------------------- Stock Market Outlook: With the C-MAPE score at 6 and the CCS at 4, we're in a short-term bullish backdrop, but as the time horizon extends, returns begin to fade. Does that mean it's time for the big short? Probably not. I suggest never making equity shorts your main play—they're designed to go up—but the risk/reward of going max long on stocks here isn't as attractive as it was at the beginning of the year. This morning, we'll get a good read on whether dip buyers are still around. The steel tariff was already known, and this reflexive selling on tariff headlines—failing for the fourth time in a matter of weeks—will likely cause most players to shut down that algorithm. The tariff drama is overblown; we have countless sets of data showing how little effect tariffs actually have on long-term inflation, and if growth remains steady—albeit slightly cooling—that's not a disaster scenario for stocks. Valuations are too high, but that's the norm, and timing markets on valuations has always been a fool's game. It's just too hard of a fight to wake up every day and want stocks to be down. It's better to trade other macro products from the short side and buy dips in stocks. It'll make your life a lot better, and your mind will be far sharper than getting stuck in the trap of hating equities in a rigged game. ---------------------------------------------------------- Bond Market Analysis: Bonds are now waiting for the CPI's next move—and the headline number will be crucial. In every report, market participants ignore fading metrics in favor of figures like super core or extreme airfare data. When back-testing inflation numbers, details like airfare figures are quickly discarded—they don't really matter. This focus on crafting a desired narrative, rather than acknowledging that inflation isn’t as severe as expected, has led many to miss the recent lows in bonds. The bottom in bonds is likely in, making it an ideal time to buy the dips rather than sell. However, with the March Fed cut currently off the table, there's a cost to holding bonds compared to short-term bills or cash. The two-year note will become much more attractive once another Fed cut is expected, but for now, its absence is a drag on duration. We need a headline push to drive the two-year yield above short-term rates and renew interest. Until then, if March remains off the table, bonds may stall—not selling off much, but struggling to push higher. ---------------------------------------------------------- Currency Markets: We've navigated the currency moves very well this year. As noted, the DXY at 110 was grossly overvalued, so we covered our trades in dollar pairs near the 107 level to avoid a reflexive short covering bounce. While we've favored the yen, the fact remains that we're at the bottom of a longer-term channel, and USDJPY could stall. Our long-term target for short USDJPY trades is far lower than the current price, but as we've said many times, carry doesn't die easily. I'm personally short near the 160 level and have no intention of changing my long-term positioning, although I've closed out of most of the JPY futures calls. I now favor using spot and holding if you're already in, rather than adding to or chasing the short, as a reflexive bounce toward the 154 level is likely. The EUR has struggled to gain strength, and its long-term destination is parity. However, if you want to short the EUR, you need a large push higher—you cannot chase it here. I have no intention of being long EURs at this point. AUDUSD is looking better in the face of a weak retaliation from China on the tariff front. Their economy and inflation metrics are holding up, and the chart is near multi-year swing lows. The odds of a total breakdown of the Aussie seem low at this point. Although China hasn’t done anything new on the fiscal side, there appears to be a rumor or sentiment based on recent stock market changes that they might. I like this one for a trade, but being long AUDUSD is still dangerous, so if you join in, keep the risk light. ---------------------------------------------------------- Commodities Market Analysis: Yesterday, I put out a post explaining that it was far too early to look for a short in oil again. That trade has played out, and as we approach $70 in CL, you have to be careful not to get caught in a short covering or FOMO rally. That's playing out this morning. A test of the $74–$75 level would make sense as oil chops around and forms a new range. I expect oil to hover between $71 and $74, with occasional pushes up toward $76 and down toward $69. Many believe that oil producers won't "drill, baby, drill" near the $70 level and that Trump is somehow on their side in this. That's just not true. Breakevens are far lower, and while people always argue with me about this, every time I try to place a bet with them, the price of drilling shuts off quickly—dropping from $72 down to $65. Oil's long-term destination is in the 60s for now, though it won't get there overnight. Gold is in full FOMO mode, and it's useless to examine the underlying factors driving it higher because there are none. This is purely an inflation hysteria and FOMO trade at this point. You should not join in, as a weak CPI number or a deflation scare could trigger a quick flush lower. Overall, gold's fair value lies somewhere in the $2700 area, but once FOMO kicks in, there's no stopping it. A push to $3000 is on the table, so I would avoid this trade from both the short and long ends for now. BTC is struggling to hold above $100K, and we're not interested until it either holds above that level or breaks down into the $80K range. ---------------------------------------------------------- VIX term structure: As we near VIX expiration, the front spread is becoming less attractive as a hedge for stock index longs. The VX curve shows a slight building pressure as you move further out, but even though it's a bit higher than normal, it's nothing to worry about at this point. Overall, the front fly has relaxed, and caution continues to be pushed out to the 30-day range. For now, all rallies are being sold—while that can't last forever, it can persist for a very long time. The flys signal some hedging activity in the 30–50 day out range, but nothing extraordinary. ---------------------------------------------------------- TL;DR Summary: - Tariff Policy: Trump's steel tariffs were a non-event, but the upcoming reciprocal tariff plan is significant. A rule aligning tariffs with those imposed on the U.S. promises fairness and eases inflation fears. - Overnight News: Trump raised steel and aluminum tariffs to 25% without exemptions, with plans for reciprocal tariffs over the next two days. He also mentioned a call with Xi Jinping, though details were sparse. - Stock Market Outlook: With a C-MAPE of 6 and CCS of 4, the short-term outlook is bullish, but extended returns are fading. Caution is advised and the overblown tariff drama has little long-term impact. - Bond Market Analysis: Bonds are waiting for the CPI headline. Key inflation metrics (like airfare data) are largely irrelevant. The bottom in bonds appears to be in, making it a good time to buy dips, though bonds may stall if a March Fed cut remains off the table. - Currency Markets: The DXY corrected from 110 to 107. USDJPY is at the bottom of a long-term channel, but caution is warranted due to a likely bounce toward 154. The EUR remains weak, headed toward parity, while AUDUSD is near multi-year lows but remains a risky play. - Commodities Market Analysis: Oil's short trade has played out; as CL nears $70, expect a new range between $71 and $74 with occasional moves toward $76 or $69. Breakevens are lower than many claim, and oil's long-term target is in the 60s. Gold is driven by pure FOMO and inflation hysteria, with a fair value around $2700 but potential for a push to $3000—so avoid trading it for now. BTC is struggling to hold above $100K, and interest will resume only if it stabilizes or breaks down into the $80K range. - VIX Term Structure: With VIX expiration nearing, the front spread is less effective as a hedge. The VX curve shows slight pressure out to 30–50 days, but caution remains as current rallies are being sold off. ------------------- If you’re interested in this type of market analysis, check out our premium service at @DSMMAprivate. We offer quantitative models, market briefings, and technical setups. Link in Bio or DM me @NikLentz, @Jimmyjude13 or @DampedSpring to get started. My market notes and breakdowns on Twitter/X will always remain free. The paywall is for those seeking deeper insights and private attention to excel in the markets. ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly ---------------------------------------------------------- == Preparation Beats Prediction == ---------------------------------------------------------- Good luck and God Bless! - Nik "The Carny" Lentz

Market Insights with The Carny – Jan 22, 2025 (Please like, RT and comment if useful, thank you!) Tariffs, tariffs, tariffs! It’s all anyone can talk about. I won’t bore you with a deep dive into my personality, but if INTJ had a picture next to it, it’d be me. I lack the hardware to trade on innuendo instead of actions—great for analyzing data and building quant programs, but absolutely terrible for understanding my wife’s feelings about seemingly unimportant things. (Spoiler: turns out they were important.) We’ve lived through the Trump years before, and I’m genuinely shocked at how much the market seems to have forgotten how it works. He’s a talker, a negotiator. They’re not going to slap 25% tariffs on everyone overnight—that’s just not how this game works. It will be challenging, but if you can tune out the media as they try to goad Trump into "implementing" tariffs through tweets and interviews, you’ll keep a cool head while others lose theirs. Trump is a master of media. Keeping the story alive—bad, good, or indifferent—is his real goal. As long as his name stays in the headlines, he’s winning. Once you see this for what it is, you can cut through the noise, focus on the actions, and trade smarter while everyone else chases the words. ---------------------------------------------------------- Overnight News ABP Invest believes the Fed will not cut rates in 2025, citing the resilient US economy and Trump's policies, with potential rate hikes starting in September. (FT) Japanese retailers are offering significant pay increases for the second consecutive year, signaling more room for central bank rate hikes. Business leaders also report signs of demand-driven inflation. (RTRS/BBG) Indian equities face further declines as foreign investors resume selling amid concerns over earnings growth and weak consumption. (BBG) A surge of Canadian oil is heading to the US ahead of Trump’s proposed tariffs, with Enbridge rationing pipeline space due to increased demand. (BBG) Oracle shares rose after Trump formally announced the Stargate JV with OpenAI, SoftBank, and Oracle, committing $500 billion to AI infrastructure to maintain US competitiveness. (RTRS) Microsoft adjusted its agreement with OpenAI post-Stargate JV announcement, allowing OpenAI to expand computing capacity beyond Microsoft’s infrastructure. (RTRS) Netflix shares surged after announcing price increases and record subscriber gains in its earnings report. (RTRS) ---------------------------------------------------------- Stock Market Outlook: The C-MAPE score remains in the 7s, with the CCS model gradually ticking back into bullish territory. The All-Weather portfolio, still held within the C-MAPE, continues to outperform the SPX. We see little reason to adopt a bearish stance in the short to medium term. Could stocks take a sharp drop? Sure. But the price action across fundamental asset spreads still points to a risk-on environment. I was a dip buyer, and as I mentioned yesterday, NQ was building energy to push higher as long as it held above key levels. It’s now well above those levels, and if this continues, the broader market will likely feel like they missed the lows and jump back in on pullbacks. There’s a short window for bears to regain control, but it’s slipping by the second. I would not chase here if you missed it, but if you see that dips are being bought on somewhat minor pullbacks, the writing is on the wall. Don't fight it. ---------------------------------------------------------- Bond Market Analysis: We’ve maintained that bonds have likely bottomed in the short term, and that view hasn’t changed. While stocks are currently favored to outperform bonds in the C-MAPE configuration, I expect bonds to take the lead as we move deeper into 2025. Tariff and inflation fears will be opportunities to buy, not sell. TIPS were a major buy at the lows—a 2.6% real yield on 30-years is hard to ignore. I still like this trade and will be adding more to the alpha portfolios once better stops can be set in the ETFs. For now, I’m loading up on anything I can for my children’s college fund and long-term accounts. SOFR reds are a buy whenever they dip to an implied yield of 4.05%. I’ve been trimming on rallies and adding on dips, with 1-year midcurve options performing exceptionally well. The US Treasury curve continues to flatten, and while I favor STIR investments, if tariff fears begin to reflect the reality of the disinflationary regime we’re moving toward, almost anything under 5 years in duration offers value—you could practically throw a dart and hit a winner. ---------------------------------------------------------- Currency Markets: The EUR is showing strength despite the steady flow of bad news. When you see BAD news paired with GOOD price action, it’s a strong signal that the market has priced in the worst and reached extended levels. While I have no plans to load up on EURs, I have to respect the fact that it may have bottomed in the short term. A daily close above 1.0460 would open the door for a swing trade opportunity. No trade is ever 100%—I’ve never seen a truly profitable system with a win rate higher than 60% (unless you’re a market maker or HFT). But this trade aligns with the technicals, and fundamentals usually follow price, not the other way around. The YEN is my preferred way to bet on dollar weakness. Japan is experiencing significant wage increases, robust unionized benefit packages, and rising inflation—issues that demand action. It’s time for the MOF/BOJ to get serious about hiking rates. The carry trade can’t last forever, and while it’s currently in vogue to view a weak currency as beneficial, the long-term consequences are starting to catch up with Japan. Now is the time for them to act. With the dollar overvalued and multiple cross-currents in play, this was the right moment to take the shot—and I’m thrilled with the entry we got. ---------------------------------------------------------- Commodities Market Analysis: Oil is breaking hearts, as it usually does. My view remains unchanged: the era of oil is over. That doesn’t mean we’ll stop using it tomorrow, in 10 years, or even a few decades, but it’s slowly exiting stage right. Rallies are to be sold. Eventually, the market will treat oil like it does natural gas, but for now, we wait for geopolitical drama to spike the price and then short. Dips can be bought after long periods of consolidation, but overall, oil is not something you should own. Once you start diving into production costs, shale industries pushing back against Trump’s "drill, baby, drill," or any other micro details, you’re losing the plot. None of these things will change the big picture—stay focused on that. Gold took off, and Jimmy and I sat there sending charts back and forth, explaining exactly how it would play out—but we didn’t buy the dip. That’s on me. I see gold as fundamentally overvalued and struggle to own it up here. Plus, I already hold a large allocation in the All-Weather C-MAPE portfolio, so I benefit without needing to time the alpha. That said, dips are likely buyable, and as long as it stays above 2700, I see no reason to turn bearish on the metal. BTC is showing signs of exhaustion, but those are often the moments when the biggest rallies happen. Paul Tudor Jones once said, "I timed the top in gold almost perfectly, but it turned out the last two days were the biggest part of the move." That sentiment reflects BTC right now. Don’t try to be a hero by timing the top. Take your crypto beta and wait for a dip to buy—but that level is nowhere near the current price. ---------------------------------------------------------- VIX term structure: VX rolls today, but beyond that, the vol curve has been obliterated. Players were initially on the right side but got spooked by fears of air-fare metrics tied to PPI and failed to close their exposure when they should have. The cold CPI print crushed them, and when that happens, it’s wildly bullish for stock indices—which played out exactly as expected. Rebuilding hedging in the curve takes time. While there were signs of stress heading into February, those concerns have now been pushed back by at least a month. ---------------------------------------------------------- TL;DR Summary: Tariffs dominate the conversation, but Trump’s negotiating tactics and media strategy suggest no immediate large-scale implementations. Focus on actions, not words, to trade effectively. Overnight, the ECB and Japanese inflation signals suggest further rate hikes, while Indian stocks face pressure from foreign selling. Oracle surged after Trump’s AI initiative announcement, while Netflix gained on strong earnings and price hikes. Stocks are in a risk-on environment, with bullish momentum in NQ likely to continue if dips are bought. Bonds remain a buy on tariff or inflation fears, with TIPS and SOFR offering solid opportunities. The EUR shows signs of bottoming, with strength despite bad news, and the YEN remains a preferred trade for dollar weakness as Japan faces mounting inflation pressure. Oil rallies are for selling as the long-term fundamentals continue to weaken. Gold remains supported above 2700, with dips buyable. BTC looks exhausted, but the potential for a big rally remains—wait for a meaningful dip to buy. VX rolls today, with the vol curve crushed after players failed to adjust to cooling CPI data. Hedging stress is now delayed into March. ---------------------------------------------------------- Preparation Beats Prediction. Good luck and God Bless! - Nik "The Carny" Lentz ------------------- If you’re interested in this type of market analysis, check out our premium service at @DSMMAprivate. We offer quantitative models, market briefings, and technical setups. Visit dampedspring.com or DM me or @Jimmyjude13 to get started. My market notes and breakdowns on Twitter/X will always remain free. The paywall is for those seeking deeper insights and private attention to excel in the markets. ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly ----------------------------------------------------------

Market Insights with The Carny – Jan 14, 2025 (Please like, RT and comment if useful, thank you!) Today is PPI, and tomorrow is CPI—these are the main events for the week. While I have complete confidence in all my systems and the technicals Jimmy and I work with, the reality is that a fundamental driver like a FED or CPI event outweighs all "technicals." If these numbers come in cold or hot, expect a significant price move in either direction. We’ll break down the potential scenarios and impacts in the sections below. ---------------------------------------------------------- Overnight News: Overnight, there was some buying in China following a "leak" that Trump’s team plans to implement tariffs lightly, starting with a 2-5% rate and ramping up only if no deal is reached. While Trump is a hard negotiator, he clearly has no intention of his first moves crashing the markets and reigniting the inflation monster. "The EU is re-evaluating its investigations into major tech companies like Apple, Google, and Meta amid Trump's return, which might lead to probes and potential fines being scaled back. (FT)" Even if they scale back the fines, the fact remains that the EU is still a horrid place to do business. You can argue about tech oligarchs, but the reality is that the EU makes everything far more complicated than it needs to be. With the DXY at 110 and EURUSD making its slow grind towards parity, I will believe it when I see it. "Japan’s former FX diplomat Kanda chimed in on the yen, saying it is desirable for the FX market to move in line with fundamentals, adding that sudden divergences from fundamentals need correcting. (newswires)" When it comes to Japan, ignore the headlines about currency moves. Until you see a sharp red line dropping on your daily chart from MOJ/BOJ intervention, it’s just noise. "NVIDIA’s GB200 shipment schedule continues to be delayed, and Q1 shipment volumes are likely to fall short of market expectations, according to sources in Asia. Cloud service providers are increasingly turning to cost-efficient and reliable in-house ASIC solutions, with some growing frustrated amid Nvidia GB200 delays. (CTEE)" Yesterday’s scare about the newest chips being duds and rushed production causing errors is gaining traction. This is as good a reason as any for some investors to take profits in NVDA. Remember, the health of the MAG7 is the health of the stock indices. A rotation into "value" might stall a drawdown in the short term, but it won’t stop it if the big players decide to sell off for a while. ---------------------------------------------------------- Stock Market Outlook: The C-MAPE is hovering around 6.5 and holding firmly onto the All-Weather portfolio. The timing of its switch was excellent, and while it’s been frustrating to see gold and bonds fail to contribute much to the portfolio’s gains, the dollar has done a great job stalling any declines. Most of the time, that’s enough to stay ahead of the benchmarks. Avoid drawdowns, and the gains take care of themselves. There seems to be a lot of stress about whether this is "the bottom," but I think that’s the wrong question. Price can only go up or down. One of the biggest issues with shorting stock indices is the math: indices tend to go up over time, so the odds are already stacked against you. Add in indiscriminate flows, passive investing, and the fact that SPX is the global hedging tool, and you have countless factors driving the index higher—many of which have little to do with actual value. There’s a reason combat sports have weight classes: the best 125-pound fighter doesn’t stand a chance against an equally skilled 195-pound opponent. SPX is the super heavyweight. Why fight against it when there are so many easier fights that can express the same trade idea you already have? If you’re intent on staying short or joining in for a crash lower, the key level to watch is 5906. Staying above that level, with breadth as blown out as it is, makes a strong case for a squeeze higher and this being a short-term "bottom." However, if we start trading below 5906—and more importantly drop under 5872—a quick move to 5750 could be on the cards. It’s better to let people get nervous first rather than jumping in prematurely. ---------------------------------------------------------- Bond Market Analysis: Bonds are currently in a challenging position as we weigh whether we’re transitioning back into a "normal" environment. Term premiums are high if we consider the last 15 years to still represent the era we’re in, but relative to historical standards, they remain on the low side. I don’t believe we’ve fully shifted into an inflationary regime. I respect those who think we have, but I just don’t see it. The broader context and long-term dynamics still seem more aligned with disinflationary forces rather than a sustained shift to inflation. By all accounts, the data suggests that inflation was, in fact, "transitory." It’s interesting to see people argue that, over 200 years of history, yields are normalizing and term premiums are low—but when it comes to current inflation lasting a few years longer than expected, they claim it’s "too long" to be transitory. Perspective matters. A few years is a blip in the broader historical context, yet it’s often treated as a structural shift. This disconnect shows how easily narratives can overpower data when it comes to understanding the bigger picture. With robotics, AI, and the global tech boom, I see no reason to fear the inflation genie. That said, it’s not a reason to buy bonds today. We need to see the PPI and, more importantly, the CPI before making any decisions. All the technicals in the world won’t mean much if those reports come in hot or ice cold. I like TIPS and will be loading up on them at these levels in my kids’ college funds and long-term accounts. I’m not quite ready to buy an ETF or bet on price outright, but I’m getting close. Any real yield above 2.5 is a screaming buy! ---------------------------------------------------------- Currency Markets: The DXY found resistance around the 110 level, which is an extreme price. Anything higher would signal a fundamental problem in the global economy. As I said yesterday—half-joking but also serious—I want to short the dollar, but I don’t want any of the other currencies. Call it the bad shirt metaphor or whatever cliché fits, but the dollar really is the best-looking option compared to the rest of the world. For now, I’m staying out until the EUR can break above some important levels. I’d like to see EURUSD trade above 1.0260 and eclipse the 20 EMA as the bare minimum before considering an entry. The YEN and Aussie are both reliant on government intervention. Unless China starts handing out stimulus checks or the BOJ steps in with intervention, I have no interest in owning either. ---------------------------------------------------------- Commodities Market Analysis: Oil isn’t selling—if anything, it’s doing the opposite. This is one of the annoying parts of trading oil. The Russian sanctions have done nothing to stop the global flow of crude, and yet another imaginary consequence isn’t going to change that. India, Russia, China, and plenty of others will gladly take Russia’s oil. That doesn’t change the fact that our trade looked great right after entry, but Sunday night changed things quickly. If price holds above $78 in the near contract and $77.50 in CLH5, I’ll need to reevaluate whether we’re too early or if something fundamental has shifted. With the EU struggling, India losing momentum, China refusing to do the fiscal heavy lifting, and Trump coming in to pump, I don’t see fair value for oil sitting in the upper $70s or $80s. The $72-$74 range feels more reasonable to me. That said, price is king, and for now, I’m slightly offsides. Gold and BTC don’t interest me at the moment—I’m favoring real yields instead. ---------------------------------------------------------- VIX term structure: 18 is a key level in VXF5, and how price reacts here will be critical. While PPI and CPI will ultimately dictate the broader direction going forward, in the short term, VOL has relaxed across the curve. The setup for another pop higher is there, so caution is advised, but overall we’re in a wait-and-see moment. I wouldn’t want to be long or short VOL here, as a break above or below the 18 level will likely bring significant movement. ---------------------------------------------------------- TL;DR Summary: - Markets Today: PPI today and CPI tomorrow are the main events this week. Fundamental drivers like these outweigh technicals. Expect significant moves if numbers come in cold or hot. - Overnight News: - Trump’s team plans light tariffs, starting with 2-5%, boosting China. - EU may scale back tech fines, but it remains a tough place to do business. - Ignore Japan’s currency chatter—action speaks louder than words. - NVDA chip delays could lead to profit-taking; MAG7 health is crucial for indices. - Stock Market: - C-MAPE holds the All-Weather portfolio at 6.5, staving off drawdowns. - Shorting SPX remains a low-odds trade—too many upward pressures exist. - Key levels: If ES stays above 5906, this could mark a short-term "bottom." Below 5872, a move to 5750 is likely. - Bonds: - Bonds face uncertainty, balancing high term premiums with a long-term disinflationary context. - Inflation appears transitory in hindsight, but PPI/CPI reports will guide decisions. - TIPS look attractive for long-term accounts—any real yield above 2.5% is a screaming buy. - Currencies: - DXY found resistance at 110—shorting the dollar is tricky without strong alternatives. - EUR needs to break 1.0260 and the 20 EMA for a potential long. - The YEN and Aussie require intervention or stimulus to be appealing. - Commodities: - Oil is rallying despite sanctions and weak fundamentals. Holding above $78 or $77.50 (CLH5) could signal a need to reevaluate the trade. - Gold and BTC remain uninteresting—real yields are the focus. - VIX: - 18 is a critical level in VXF5. A break above or below will likely bring significant movement, but for now, we’re in wait-and-see mode. ---------------------------------------------------------- Good luck and God Bless! - Nik "The Carny" Lentz ------------------- If you’re interested in this type of market analysis, check out our premium service at @DSMMAprivate. We offer quantitative models, market briefings, and technical setups. Visit dampedspring.com or DM me or @Jimmyjude13 to get started. My market notes and breakdowns on Twitter/X will always remain free. The paywall is for those seeking deeper insights and private attention to excel in the markets. ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly ----------------------------------------------------------

Market update: Stock indices continue their ascent after breaking through the news pivot we discussed this morning. If you missed that initial breakout, there’s not much to do at this point. Overall, 6088 in ES isn’t off the table, though with NQ stalling around 21850 and NVDA already up 5%, it might be a tough ask for now. When a news event triggers shorts that later get "corrected," these grind-higher scenarios often come into play. Initial shorts get stopped out, latecomers pile in at the previous highs, and then they get stopped out too—fueling the slow, bullish grind we’re seeing through the day. I wouldn't step in front of this one, even if you could end up being right in the end. Bonds look like trash, giving back their rally almost instantly, even before the Trump tariff news was rebuffed. However, the front of the curve is showing signs of life, with SOFR Z5 (now technically a white) and the front of the REDS recovering. Overall, bonds seem to be leaning toward higher yields. I’d avoid buying longer duration for now, but the front of the curve looks promising if it can hold above the 1440 midpoint and the day’s adaptive pivots. The dollar remains choppy, but the game plan from the morning briefing still holds. The tariff drama triggered a solid sell-off, but the dollar has since retraced about 50% of that move. We maintain a bearish lean on the dollar and think it’s a good time to start keeping an eye on the EUR. However, a daily close above key levels is needed before committing to a full position on that trade. Oil and gold remain choppy, with oil holding above key levels and gold showing slight weakness, but nothing significant yet. BTC is behaving like a leveraged NQ today—no clear trade there either. On days like this, it’s either join the momentum or step back. Short-term trading is as much about knowing when not to act as it is about taking action. Sitting at the screen all day can create a compulsion to bet money—avoid that at all costs. Today is a trend day, and unless you’re aligned with the trend, it’s better to take a walk or an early lunch until the market gives you a reason to engage. I will update everyone if anything changes. For now watch the two year or SOFR Z5 for signs of bullishness. ------------------- If you’re interested in this type of market analysis, check out our premium service at @DSMMAprivate. We offer quantitative models, market briefings, and technical setups. Visit dampedspring.com or DM me or @Jimmyjude13 to get started. My market notes and breakdowns on Twitter/X will always remain free. The paywall is for those seeking deeper insights and private attention to excel in the markets. -------------------

Market Insights with The Carny – Dec 19, 2024 (Please like, RT and comment if useful, thank you!) The FED came in with a "hawkish" cut, something I thought was impossible. Yet, judging by asset prices, it was successful across the board. Stocks crashed—but in a way I’ve never seen before. Usually, you’d expect some kind of bounce during the day, but this was relentless selling with no bounce, not even on a 1-minute chart. While ending the year around 6000 would be an extraordinary year that almost no predicted Jan 1, which shows the absurdity of full year predictions, there was real damage done yesterday. ---------------------------------------------------------- Stock Market Outlook: The C-MAPE (Carnival Multi-Asset Portfolio Engine) locked in profits across the board in November while adding a series of VX futures and options hedges. Shortly after, it transitioned to an All-Weather portfolio, which it will maintain until positioning washes out and latecomers are cleared. With the current score down to 6.7 from the 8s just a week ago, the washout appears imminent. Over the next few days I would expect a drift lower in the scores and a rebalance into a normal equity risk position. SPX breadth has collapsed, with only 28 SPX stocks currently above the 20 EMA—a truly extreme reading. Some of my favorite bottom-hunting systems, dormant for years, could finally emerge from hibernation. That said, stocks remain expensive on valuations and aren’t an outright buy at 6000. However, in these extreme conditions, buying dips becomes viable without needing the usual "fiscal" backup to justify the trade. We recommend a wait-and-see approach, focusing on hunting for long-term price dislocations in single names. While this note primarily covers macro assets, not individual stocks, the best time to buy is when there’s “blood in the streets.” At an SPX level of 6000, there’s not even a drip of blood yet. That said, panic can create opportunities. They practically gave away FB (META) in the $90s not long ago—nobody wanted to own it, but that trade ended up funding my oldest daughter’s future college expenses. That’s the kind of action we’re waiting for—not rushing to buy ETFs before year-end. ---------------------------------------------------------- Bond Market Analysis: During yesterday’s stock rout, bonds couldn’t catch a bid, leaving us in a catch-22 trying to explain the action. Were stocks crashing because term premiums were rising? Or was it a case of “sell everything and ask questions later” to hedge books and protect year-end bonuses? In the coming days, we’ll face JPM collar trades, rebalances, and a slew of events leading into year-end that will make the equation even harder to decipher. Sometimes, there’s no clean narrative—just chaos to navigate. The Powell presser started off very dovish—a cut is dovish, no matter how you spin it. But with two cuts removed from the dot plot and a dissent, it’s clear many believe the FED is losing its grip on the narrative. Since the first cut, long duration has been in freefall, with tariff fears turning it into something of a leper. There’s enough material here to write 30 pages dissecting the various economic outcomes, but for the sake of brevity, I’ll condense it as much as possible. The SOFR REDS have priced in just a single cut for 2025, which feels like an overreaction. We’ve started a position in Z25 and are watching for opportunities further out in the REDS and GREENS. While sentiment isn’t an indicator, my spider senses are tingling as everyone and their mother preaches about how strong the economy is. The fact remains: the rest of the world is sliding into recession. While the U.S. may be insulated, it doesn’t mean we won’t catch a cold while others suffer the flu. Unemployment has been rising, and while some argue it’s due to new entrants struggling to find jobs rather than existing layoffs, the numbers are what they are. It’s always tempting to focus on the "why," but it’s better to let the data speak for itself. We like long SOFR across the curve in the REDs and GREENS and will be looking to add to these trades in the future. Bonds, however, are in a tougher spot. While I’ve nailed most SOFR trades this year, my duration trading hasn’t quite measured up. I should probably stick to STIR and leave bonds to my friends @nickgiva1, @LongTplexTrader, and @dampedspring. But in my quest to understand the curve better, nothing teaches like having a full position on. The FED decision should favor bonds over equities, and we’ll be focusing on the 2-5 duration spectrum, with some degen lunch money trades on longer durations. The front end of the curve currently holds more value, and besides STIR—which remains our main focus—heading into 2025, we favor bonds over stocks. That said, predicting the future is not an investment strategy, so we’ll stick to reading the data as it comes. ---------------------------------------------------------- Currency Markets: Yesterday brought some interesting market responses. The dollar surged higher, which aligns with the presser's hawkish tone. The EUR, unsurprisingly, fell sharply—another confirmation of the hawkish interpretation—but we took profits across the board on all EURUSD shorts. That washout was likely all one can expect for now, and chasing the dollar higher here feels reckless. We anticipate some cooling or at least consolidation in the coming weeks, but we’ll remain focused on the various dollar pairs. Japan, as expected, waffled on hikes. The USDJPY is eyeing the 160 level, but only intervention would make this pair interesting again. You can’t out-dove the BOJ, so don’t bother trying. Why they want their currency to be worth less is anyone’s guess, but until they signal a shift in that game, finding value long the YEN is a futile exercise. ---------------------------------------------------------- Commodities Market Analysis: Oil barely moved yesterday, despite the ongoing OPEC drama, the U.S. solidifying its role as a major exporter, and Russia scrambling to offload its "illegal" crude. There’s little reason to expect a rally anytime soon. Stick to the $66-$73 range for chop trades, but we’d steer clear of any long-term investments in oil for now. Gold remains a fade on any long-term rallies, but if you’re not already short, there’s no reason to chase here. Inflation fears are overblown, and the FED’s long-term dots confirm they’re more comfortable with inflation staying range-bound than enforcing the hard 2% ceiling of the past. Yes, things are expensive, and the average person is feeling the squeeze, but long-term entrenched inflation isn’t a rational concern for anyone seriously analyzing the data. From tariffs to debt-interest doomers, everyone will tell you that you must own gold. The reality? Tech and TIPS offer far more value if inflation "comes back" than a negative-yielding shiny rock ever could. That said, gold does have its place. It should always be a part of a portfolio, but like anything else, it’s just one small piece of the overall puzzle. BTC is in limbo and we see no reason to be long or short. ---------------------------------------------------------- TL;DR Summary: SPX breadth has collapsed, with only 28 stocks above the 20 EMA—a signal extreme enough to activate dormant bottom-hunting systems. Bonds show strong potential, particularly in the 2-5 duration spectrum, and SOFR trades in the REDs and GREENS remain a primary focus, with more opportunities likely ahead. Commodities like oil and gold offer little appeal for now, while BTC remains in limbo. As we head into year-end, patience and a focus on dislocated single names will be key to navigating the market. ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly ----------------------------------------------------------

Nik “The Carny” Lentz @NikLentz

2 years ago

Market Insights with The Carny – Dec 13, 2024 (Please like and RT if you find this useful, thank you!) Xi declined Trump’s inauguration invitation but left the door open for an "important" representative to attend. These diplomatic chess moves are likely to continue over the

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Market Insights with The Carny – Dec 17, 2024 (Please like and RT if you find this useful, thank you!) FED Preview: As we head into the FED decision tomorrow, the U.S. economy remains stronger than the rest of the world, where chaos has pushed central banks to slash rates. With a resilient service sector, solid productivity, and "problems" driven more by pundits than reality, the FED has room to pause—but no real reason to rush unless global turmoil spills over. This cycle has been anything but normal. COVID’s aftermath and a historic 30-year mortgage refi boom have insulated the U.S. from short-term rate shocks. Meanwhile, AI has taken the reins, driving animal spirits and fueling perceived productivity gains, leaving the FED with far less control over the narrative. Inflation? It was transitory. Supply chain breakdowns, war, and food shocks—none of it was the FED’s doing. They didn’t tame inflation; they got lucky when the storm passed. Nicky Leaks (@NickTimiraos): "Powell is (again) trying to find the right gear for monetary policy amid signs the labor market is less wobbly and inflation is a touch firmer than they appeared in September. Given current market expectations of a cut, the path of least resistance would be to cut by a quarter point, and then use new economic projections to hint the central bank is ready to slow the pace of reductions." While most of us roll our eyes at the current state of forward guidance—so much so that even podcasters are abandoning the name—the FED is still trying to land the plane softly. What _has_ changed is the growing fear around the long end of the bond market. As we approach recent lows on 10-year and long bonds, the bond vigilante narrative is back. The fear is misplaced—we’re nowhere near the absolute lows for this cycle—but confidence in the FED has slipped with the 10-year falling alongside their aggressive cuts. Powell will attempt a “hawkish” cut. Expect mixed signals—enough to confuse the market without shifting the current narrative. A stock pullback and a small bond rally make sense, but overall, it’s just noise. If they don’t cut, stocks likely drop 5% over the next week or two—still a BTD moment. Playbook: - Buy dips in the dollar. - Sell EUR on significant rallies. - SOFR has priced in massive hawkishness—buy the REDs out. - Short duration bonds are a buy. - Sell oil rallies. - Gold isn’t worth owning at these levels. - BTC looks due for a pullback—watch Saylor momentum and MSTR NAV in the short term. Summary: The FED decision looms large, but the playbook is clear. The U.S. economy’s strength gives Powell room to pause, not ease. Stocks may wobble, bonds may bounce, but dips should be bought. Focus on the dollar, EUR weakness, SOFR REDs, short-duration bonds, and selling oil rallies. Gold stays off the list, and BTC’s path depends on Saylor and MSTR dynamics. Hype remains high, outcomes familiar. Patience is key. Good luck and God Bless! -------------------------------- Follow @PiQSuite for the best news source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly. --------------------------------

Nik “The Carny” Lentz @NikLentz

2 years ago

Market Insights with The Carny – Dec 16, 2024 (Please like and RT if you find this useful, thank you!) Over the weekend, global headlines were dominated by economic updates and escalating conflicts. With Trump’s Dr. Strangelove-style leadership looming, geopolitical tensions are

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@NikLentz Thanks a lot Nik. Excellent note 👍

Market Insights with The Carny – Dec 13, 2024 (Please like and RT if you find this useful, thank you!) Xi declined Trump’s inauguration invitation but left the door open for an "important" representative to attend. These diplomatic chess moves are likely to continue over the next four years, with MSM and social media treating it like a reality TV show. Navarro’s warnings to China about currency manipulation reveal a fundamental misunderstanding of tariffs. If China devalues its currency, it essentially subsidizes U.S. tariffs—a move aligned with their goals. During Trump’s first presidency, we often saw moments where progress aligned with objectives, only for key players to veer off course. While Trump has learned from past victories and failures, the critical question for markets going forward is whether he can maintain his strong rhetoric while entrusting actual financial experts to move the pieces behind the scenes. ---------------------------------------------------------- Stock Market Outlook: Stocks are reaching extended sentiment levels, but there’s still no clear catalyst for a sustained selloff. Yesterday’s PPI came in blistering hot, with even the reversions leaning warm. While PPI has lost some of its former significance, CPI numbers—along with "super core" and other trendy elite metrics—remain elevated. The "higher for longer" inflation regime seems to have caught its second wind, keeping the market melt-up intact as we move into the seasonally positive period. The front VOL spread Dec/Jan is struggling to push higher at the elevated level of 1.83. While there are slight signs of tension building under the VOL curves, it’s still not enough to conquer the animal spirits or Kris Kringle’s cheer. We don’t see a reason for a collapse in prices, but we are taking profits at these elevated sentiment levels and preparing to reload on any significant pullback. ---------------------------------------------------------- Bond Market Analysis: The hot PPI and inline but elevated CPI numbers are driving bonds lower following their recent push higher. While the 2-10 year complex charts remains intact, the long bond is breaking key levels to the downside. Despite this, we don’t see a reason to jump short bonds here. Initial claims and other economic data are starting to show subtle signs of weakness again, tempering the case for aggressive bearish positioning. Inflation hawks may argue that prolonged elevated levels demand renewed Fed hawkishness, but such hysteria feels misplaced. While inflation remains above the arbitrary 2% threshold, wage growth continues to outpace it, and the crisis conditions of the past have subsided. The Fed’s 2% inflation mandate has long been irrelevant, and those clinging to the idea that the Fed cares about rigidly keeping inflation within 2% are misreading the current policy tone. We still see value in both the 2-year and 10-year bonds. However, if they retrace to 50% of the recent move higher without showing signs of buyer support, it would signal trouble. In such a scenario, a break of the lows could follow quickly. ---------------------------------------------------------- Currency Markets: While the Fed may lean toward pausing, the rest of the world has already front-run the panic. The Swiss unexpectedly cut by 50 bps, Germany’s economy continues to decline, France is in disarray, and the UK’s economy and services sector are shrinking. There’s little justification to favor the EU over the U.S., and it’s surprising that some still hold onto this narrative. The EUR has failed to sustain even modest rallies and is now heading back toward the lows. We’ve been short EUR for a long time but have significantly reduced our position, taking profits amid the extreme adjustments in flows. While we wouldn’t chase prices lower, there’s equally no reason to buy the dip at this stage. Japan, meanwhile, remains indecisive on whether to hike, making their meetings and forward guidance frustratingly irrelevant. The USD/JPY trade is a non-starter for us until clear intervention levels appear on the charts. Until then, we’re staying out of the game. ---------------------------------------------------------- Commodities Market Analysis: Oil has demonstrated strong buying interest around the $66 range low. While we remain bearish on oil in the long term, it’s clear that many see value at current levels. The $66-$73 range is once again playable, and oil appears poised to squeeze some late shorts for a potential rally to the upside. Tight stop management is essential here, with a focus on the broader perspective that oil’s long-term value and price direction remain lower. Gold attempted to rally but remains biased to the downside, a view we continue to favor. The newly established lower high provides an excellent level to work from for continued downside momentum. A break of 2660 on GC would signal that dip buyers have capitulated, likely triggering a sharp move toward recent lows. If you’re not already short, we don’t recommend chasing here, and dip buying gold remains off the table for now. BTC will likely face a correction in the near future, especially if Saylor becomes a seller when (if)MSTR gets into the NQ. BTC remains a technical trader’s dream, often presenting clear dip-buying or selling opportunities. With the key round number of 100k holding, we see no reason to chase or short at these levels. A violent correction is inevitable in the next few months—the real question is, will you be ready for it? ---------------------------------------------------------- TL;DR Summary: Markets continue to show resilience, with stocks maintaining extended sentiment levels amidst a seasonally positive period. Bonds are under pressure from elevated inflation data but still hold value in the 2-10 year range. The Fed’s shift toward a 2-3% inflation focus tempers hawkish concerns. In currencies, the EUR is heading back to lows, while USD/JPY remains a waiting game until clear intervention levels emerge. Commodities see oil holding value within a $66-$73 range, while gold struggles, favoring downside momentum. BTC, holding near 100k, is primed for a potential correction in the months ahead. Good luck and God Bless! ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly ----------------------------------------------------------

Nik “The Carny” Lentz @NikLentz

2 years ago

Market Insights with The Carny – Dec 9, 2024 (Please like and RT if you find this useful, thank you!) Last week’s data release aimed to "unglue" the market from its current range but was unsuccessful. The jobs report showed a rebound in numbers as expected. Unemployment claims

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Market Insights with The Carny – Dec 9, 2024 (Please like and RT if you find this useful, thank you!) Last week’s data release aimed to "unglue" the market from its current range but was unsuccessful. The jobs report showed a rebound in numbers as expected. Unemployment claims remain at the low end of historic ranges, though continued claims ticked up slightly. The unemployment rate also edged higher, moving from 4.1% to 4.2%. Many people focus on initial claims data, released weekly as a gauge of the labor market. However, backtesting shows it rarely serves as a reliable short-term predictor. The unemployment rate is a far more meaningful and significant metric, deserving more weight in labor market analysis. Even with these shifts, the data remains mixed and offers little in terms of real predictive value. This is why markets continue to float higher. In any melt-up, it takes a true disruption to trigger a panic, and this data hardly qualifies as a break. On some levels, it’s even stimulative. On the geopolitical front, the recent overthrow of Syrian President Bashar al-Assad has raised concerns about the resurgence of extremist groups like ISIS. However, historical data indicates that approximately 95% of geopolitical volatility is transient and often doesn't lead to significant long-term market impacts. While war, corruption, and loss of life are profound human concerns, asset prices typically remain unaffected over the long term. Investing based on emotional reactions to such events can lead to financial losses. It's crucial to maintain a disciplined approach and not let feelings dictate investment decisions. ---------------------------------------------------------- Stock Market Outlook: Stock indices cooled slightly during the EU session, but 5-day average scores remain elevated. While many held onto the small-cap narrative of the Trump presidency, the tech giants have reclaimed the spotlight. A significant rotation has shifted capital out of traditional cyclicals and back into the Mag 7. Overnight, we saw a notable reaction in "Chyna" stocks as the government reiterated its commitment to doing what is necessary. Yet, skepticism persists. It’s time to believe—and has been—but, as usual, many will wait until the bulk of the move higher is over to avoid being early and facing a slight drawdown. The Carny Portfolio Score stands at 7.62, indicating potential gains over the next 30 days. Given the elevated levels, patience is crucial for those considering bearish positions. We don't recommend chasing the market at these heights, but there's no immediate reason to fear a collapse. Dips remain buying opportunities until further notice. However, anticipate potential fluctuations within a broad range, so proceed cautiously. ---------------------------------------------------------- Bond Market Analysis: Bonds are cooling off after attempting to breach some key upside levels. With current scores around 3, they’ve moved from extreme bearishness into neutral territory. It’s natural for prices to consolidate here, but there’s no reason to turn bearish again. The recent rally was inevitable, given the deeply oversold conditions—almost anything could have triggered it. Dips remain buyable at this stage. While many will fixate on the third decimal place in inflation data, it’s largely irrelevant until we return to discussing significant "big figures" in inflation numbers. If you’re long, as you should be at this point, now is a good time to adjust positions and move stops. The "easy money" has already been made, but if the current picture continues to develop, there’s still considerable upside left to capture. ---------------------------------------------------------- Currency Markets: The euro has bounced from abysmal levels, but a brief glance at EU data reveals systemic issues that make holding euros unappealing. The EU is grappling with poor management across multiple fronts: - **Immigration**: Challenges are intensifying. - **Green Initiatives**: The so-called "green revolution" is faltering. - **Taxation**: Burdens remain excessively high. Given these factors, there's little reason to favor the EU economy over the U.S. Despite this, we don't recommend chasing the dollar higher or the euro lower at this juncture. Allow time for prices to adjust and for the euro to bounce on positive news from China. Historically, Chinese economic stimulus boosts demand for luxury goods—a sector where EU economies still thrive. This often leads to mini-rallies in European stocks and currencies, providing more favorable levels for short positions. Regarding USD/JPY, it's best to avoid this pair for now, as there are more straightforward trades available. ---------------------------------------------------------- Commodities Market Analysis: "Oil should be up $10!" That’s the predictable cry from perma-bulls whenever tensions flare in the Middle East—a region where conflict has been constant since its inception. The fact is, an oil spike at this point requires more than wars or perceived bottlenecks; it demands tangible, physical disruptions. If we see a real shutdown of the Strait of Hormuz, then all bets are off. Until then, it’s all just noise. India has slowed its aggressive acquisitions of Russia's "illegal" oil trades as its economy cools. Meanwhile, China remains in turmoil, though recent stimulus efforts could spark slight bullish sentiment. OPEC's influence is waning as smaller players recognize the long-term decline in oil demand. The fact remains: oil is a sell—but not from the bottom of the range. You can trade within the $66-$73 range for now, but we’re waiting for better levels to short from. Gold remains unappealing at current levels, despite a recent uptick in central bank purchases, including notable buying by China's central bank in November after a six-month hiatus. Historically, gold tends to enter prolonged periods of stagnation, marked by gradual declines and occasional sharp spikes during times of stress—typically following initial sell-offs in other assets. Given this pattern, we advise against trading gold at this time and see no compelling reason to buy the dip in the near future. Bitcoin has finally cracked the $100,000 level, but now what? You'll see all the podcast bros concocting terms, uses, ETF flows, and every other justification for the price. The fact remains, as it always has, that Bitcoin is a gambler's and emotional trader's sardine. Very few people have owned it as long as I have, and even fewer truly understand what it is. It boils down to a marketing tool. Accept that, and you can make money; fall in love with its supposed world-changing uses, and you'll end up the ultimate bag holder. ---------------------------------------------------------- TLDR-Summary: Markets continue to grind higher as recent data failed to disrupt the current melt-up. The unemployment rate ticked up slightly, but labor market data overall remains mixed and largely unremarkable. Geopolitical tensions in the Middle East and other regions remain background noise for markets, with no tangible disruptions to drive sustained volatility. Bonds are consolidating after an oversold rally, and gold remains unappealing during its typical hibernation phase. Oil, despite its range-bound behavior, is not a buy. We are waiting for better levels to short. Bitcoin broke $100K, fueling speculative narratives, but its true nature as a marketing-driven asset remains unchanged. ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly ----------------------------------------------------------

Nik “The Carny” Lentz @NikLentz

2 years ago

Market Insights with The Carny – Nov 26, 2024 (Please like and RT if you find this useful, thank you!) The dreaded Trump Tweet (or Xeet, or whatever we’re calling them these days) is back! Even though I voted for the guy, I can tell you from experience… he comes with many

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They gave you a free entry into bonds yesterday for whatever reason. I didn’t load the boat—mainly because I’ll be on a boat next week, a rather large one, in a suite, with my family—so I’ve chosen not to play. The game plan remains the same: Stocks: Returns are projected to be positive across most Carny models. Bonds: This bounce is overdue and should not be faded. Dollar: Still king, but this pullback was expected. Oil: It’s unlikely to survive the 3-3-3 rule and should head lower over time—but DO NOT short in the hole. Gold: A sell on any significant rally. BTC: It’s going to make another run at 100k—it’s just a question of from what price level. Good luck, and God Bless! ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly ----------------------------------------------------------

Nik “The Carny” Lentz @NikLentz

2 years ago

Market Insights with The Carny – Nov 26, 2024 (Please like and RT if you find this useful, thank you!) The dreaded Trump Tweet (or Xeet, or whatever we’re calling them these days) is back! Even though I voted for the guy, I can tell you from experience… he comes with many

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Market Insights with The Carny – Nov 22, 2024 (Please like and RT if you find this useful, thank you!) Overnight, there was a series of saber rattling over "Chyna"—in Texas, of all places. Governor Greg Abbott ordered state agencies to cease investing state funds in China, which I’m assuming is more of a symbolic move, as I don’t see the Lone Star State being a huge investor. Talks of foreigners dumping Chinese bonds and rumors of large-scale currency depreciation if tariffs hit were enough to spark an overnight sell-off in everything China. Meanwhile, the UK continues to flounder, with German economic growth in the gutter and UK retail sales diving. The EUR remains hopelessly weak, even while being clearly extended to the downside. Gold spiked on international war drama, and stock indices are showing weakness. ---------------------------------------------------------- Stock Market Outlook: Despite stock indices hovering near all-time highs, sentiment is gradually shifting toward neutral territory. This "wall of worry" often suggests price stability, as cautious optimism prevails. The Carny Portfolio score stands at 7.93, indicating a risk-on stance. Historically, scores in this range have correlated with an average 30-day return of 3.93%, potentially propelling markets to new highs by year-end. While it's prudent to avoid chasing gains, current indicators show no imminent signs of a market downturn. Barring significant news—such as geopolitical tensions, which paradoxically can be bullish—we see little reason to adjust our portfolios. Our all-weather strategy has fortuitously captured major gold movements this year, a reminder that in trading, a bit of luck can be invaluable. ---------------------------------------------------------- Bond Market Analysis: The bond market has flattened across all dimensions, and while there are faint signs of life in the 10-30 year segment, we see little justification for a rally in these maturities without the twos joining the party. While bonds look "ready" to pop, they seem to never come through when it counts. The FED, tariffs and new inflation fears have prevailed and until Trump gets into the white house, without a significant news catalyst we see little reason to except a rally. Current sentiment scores are hovering between 4 and 6, indicating a bearish environment. Previous attempts to preempt this trend have resulted in minor setbacks. Therefore, we are adopting a cautious approach, waiting for clearer signals before making decisive moves. In the realm of SOFR trades, the landscape remains unremarkable. Over the past few years, the Overnight Index Swap (OIS) market has consistently outpaced Fed Funds and SOFR futures, maintaining a "higher for longer" stance. In contrast, SOFR prices have exhibited volatility reminiscent of Bitcoin futures, leading to unpredictable movements. For now we are in a wait and see with the idea that when bonds pop, we could be second to that party. ---------------------------------------------------------- Currency Markets: As we’ve developed the Carny sentiment and portfolio scores, one consistent mistake has been not holding onto trades long enough. When scores shift alongside a strong macro backdrop, that’s the time to HOLD. The EUR’s crash from 1.12 to 1.04, with no signs of recovery, is a prime example. "UK retail sales fell by much more than expected in October, according to official data that added to other signs of a loss of momentum in the economy in the run-up to the first budget of Prime Minister Keir Starmer's new government." (RTRS) "Germany's economy grew less than previously estimated in the third quarter, in further bad news for a country set to be the worst performer among the Group of Seven rich democracies this year." (RTRS) Headlines like these are endless. The simple fact is Europe’s resurgence is nowhere in sight. The region is paying dearly for its energy policies, immigration decisions, financial mismanagement, and the ever-looming war threat creeping closer to its shores. There’s no logical or bullish case to be made here—aside from the irony that “there’s no logical or bullish case to be made.” When situations like this arise, we must start examining whether the harsh reality has already been “priced in.” While we generally loathe the “priced in” argument as much as a Clinton despises a Trump voter, it’s something we have to consider. Going forward, we’re waiting for a rally to short, but for now, that seems like low odds. The Fed remains in a position to be overly hawkish compared to EU central banks. While there are some interesting setups in EUR/JPY, we’re currently in the wait-and-see camp. Japan, meanwhile, is stumbling as it tries to stimulate without spooking markets, hike without looking weak, and manage unions all at once. It’s a mess best avoided for now. Until we see a clear currency intervention marking a line in the sand, we’ll continue steering clear of JPY pairs. ---------------------------------------------------------- Commodities Market Analysis: Oil continues to stay in the $66-$73 range, and we see no reason for that to change anytime soon. The key is always remembering the backdrop: 1. OPEC: They’re cutting back supply, not restricting it as people often assume. 2. USA: The U.S. is pumping like crazy, and Trump isn’t going to reduce that. 3. The Era of Oil: The dominance of oil will likely end within the next 50 years, and other countries are fine lowering prices to get paid while they can. 4. Russia: Russia is rerouting supply as China and India’s economies weaken, driving prices down further. While a rally here could make sense in the short term, there’s no long-term value in it. Over the next decade, oil will likely evolve to trade more like natural gas. Gold has recently surged to the $2,700 level, prompting us to consider shorting opportunities. The rise in prices has made GC futures more expensive, and options contracts aren't offering the same value. Therefore, we may opt for an outright short of the futures. This approach carries inherent risks, especially given that geopolitical tensions can drive gold prices higher. However, the current fundamental backdrop, coupled with a slowdown in central bank gold purchases, suggests that gold's upward momentum may be waning. Additionally, the correlation between Bitcoin and gold is near all-time lows, indicating that retail investors are shifting from the non-yielding metal to the crypto market. BTC is inspiring people to spend millions on bananas taped to walls (not a joke). As always, when money comes easy—without effort or struggle—it often slips through people's fingers and into the hands of more sophisticated participants. But this doesn’t happen overnight. The key when others are getting rich while you’re grinding is this: You are not them, you cannot be them, and no amount of wishing will change that. Stick to your game plan, stack your cash, and in 10 years, while they reminisce about the "good old days," you’ll still be living the good life. There’s no shortcut to riches, and money alone won’t provide fulfillment. FOMO kills—don’t let it distract you. Stay focused. ---------------------------------------------------------- Summary: Markets face geopolitical tensions and economic challenges. China saw overnight sell-offs amid bond dumping rumors and currency fears. Europe’s economy remains weak, with the EUR struggling to recover. The Fed’s hawkish stance keeps pressure on EU central banks, while Japan’s policy confusion leaves JPY pairs in limbo. Commodities remain range-bound, with oil at $66-$73 and gold hitting $2,700, sparking shorting opportunities. BTC continues its speculative run, reminding traders to avoid FOMO and stick to disciplined, long-term strategies. Stay focused, stay patient, and don’t chase the noise. ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly ----------------------------------------------------------

Nik “The Carny” Lentz @NikLentz

2 years ago

Market Insights with The Carny – Nov 20, 2024 (Please like and RT if you find this useful, thank you!) Overnight, bonds sold off as the "nuke" threat lessened. Overall, we've shifted to a headline-driven market as we wait for economic reports to give a clearer picture of the

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@NikLentz I would love that yes. Thank you

Market Insights with The Carny – Nov 20, 2024 (Please like and RT if you find this useful, thank you!) Overnight, bonds sold off as the "nuke" threat lessened. Overall, we've shifted to a headline-driven market as we wait for economic reports to give a clearer picture of the next metric to focus on. Marc Rowan emerged as a top contender for Trump's secretary pick, while Lutnick was picked as Commerce Secretary. Going forward, we need to keep a level head as the media pushes narratives about Trump's picks, the tariff threat, and "American businesses are stocking up on imported goods" (WSJ). The simple fact is none of this stuff will matter until it actually happens. Real events move markets long term, not imaginary ones. Look for price dislocations on headlines—fading them will be the play until we get a handful of economic reports. Then we can go back to Fed nonsense again. ---------------------------------------------------------- Stock Market Outlook: Stocks are hovering near all-time highs, with minor panic sell-offs quickly bought up. The overall picture remains unchanged, with no immediate signs of an imminent collapse. The Carny Quant score for stock indices is holding steady around 6 after an extended move higher. Headline-driven sell-offs have taken some steam out of the market, typically setting the stage for recovery rallies when the world doesn't end as predicted. The Portfolio score sits at 7.5, favoring stocks over bonds, high beta over low volatility, and high yield over investment-grade paper. This is still a "buy the dip" market. Until flows are meaningfully disrupted or we break through key levels, there's little reason to expect a significant move to the downside. That said, be prepared for volatility—after such a big move, a few hundred points in either direction would be logical. We've transitioned from high-risk beta to a hedged approach, and now to an all-weather portfolio after covering the hedges. The timing has been excellent; now we wait to see what unfolds. Bottom line: Don’t add risk here, but panic selling is not the move either. Stay disciplined. ---------------------------------------------------------- Bond Market Analysis: The threat of nuclear war produced a measly 10-year rally of just 30 basis points over a few hours. That has since been entirely reversed, with yields now heading higher again. The reality remains that the Fed’s over-the-top 50-basis-point cut has made the long end of the curve nearly uninvestable. We’re reaching a point where curve dynamics are starting to matter again. Bear flatteners and the occasional bear steepener have been the dominant plays, but if the Fed continues its rate-cutting spree, the 2-year is looking overextended to the downside. A bull steepener could soon come into play as the 2-year hovers around key levels. For retail traders, a good way to play a rally in the 2-year is with TUA. While we stick to the futures products ourselves, this is the trade we’re currently watching for signs to enter. ---------------------------------------------------------- Currency Markets: In the distant past (about a few months ago), the dollar was supposedly circling the drain, threatened by a BRICS overthrow and a recovering EU economy. As usual, that turned out to be a pipe dream. The dollar has made a massive move to the upside but seems to need a little time to cool off. We’re now waiting for an event to push the dollar lower, setting up the EUR for a short-covering rally and another opportunity to play the other side. EUR/USD looks weak and shows no signs of life—exactly the kind of setup where going long catches late shorts off guard. If we’re lucky, a rally could push the EUR back to key levels, where we’d look to short again. Meanwhile, headlines like "Euro Could Head to Parity Soon" are flooding news streams—never a great sign for bears. You NEVER want the media on your side! As for the YEN, it’s still in the “too hard” category. While many are falling in love with EUR/JPY, we see no reason to play them against each other unless you want to give up sleep or live overseas. Some trades are just better left alone. ---------------------------------------------------------- Commodities Market Analysis: Oil prices are seeking catalysts to move higher, but responses remain muted. The $66 level has consistently provided support, establishing a trading range between $66 and $73. While we're not currently looking to go long, it's important to note that in the current environment, most headlines are likely to be bullish, and the current price is too low to fade those moves. Short positions become attractive around the top of the range at $73 and then at $76. We anticipate oil to oscillate between $66 and $73, potentially causing volatility. If you're considering going long on oil, it's advisable to be nimble; this isn't the time to hold positions for extended periods. We're eyeing a short position in gold, targeting the $2,700 level for entry. This price point offers a clear stop placement, and we anticipate a prolonged decline over the next year. Central banks have largely reached their desired gold reserve levels, and retail interest has shifted towards Bitcoin. Gold held its ground at the FOMC low but is currently trading below all major moving averages. The joy in this trade is gone, and like Kamala, we don't see it returning anytime soon. BTC bros are trying to revive the Rolex market, and G-Wagon orders are up! It’s party time, and we see no reason why BTC won’t fulfill the round number prophecy and eclipse the $100k level. As always, Bitcoin is built on dreams and fairy dust, but that’s never stopped it from being a great way to get rich. Some might think this means I’m negative on BTC, but that couldn’t be further from the truth. I love the gambling nature and the honesty of it. I just wish people would stop pretending they’re investing in the stock market any differently. ---------------------------------------------------------- Summary: Markets remain headline-driven, with bonds selling off as geopolitical fears ease, while stocks hover near all-time highs in a "buy the dip" environment. The dollar has surged but may cool, creating opportunities in EUR/USD, while oil chops between $66-$73. Gold looks weak, with $2,700 as a short-entry target, and BTC marches toward $100k, fueled by dreams and fairy dust—but still a great way to get rich if played right. Stay nimble and disciplined across all markets. ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. All opinions are my own. Please trade responsibly ----------------------------------------------------------

Nik “The Carny” Lentz @NikLentz

2 years ago

Market Insights with The Carny – Nov 18, 2024 (Please like and RT if you find this useful, thank you!) Good morning! Yesterday, while deep in model testing and code upgrades, an unexpected file update completely crippled my main systems. Thousands of hours of work seemed to

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Market Insights with The Carny – Nov 15, 2024 (Please like and RT if you find this useful, thank you!) Retail sales will be the key event closing out what's been a strange week in price action. The Trump election outcome continues to drive market sentiment, with inflation concerns resurfacing and a perception of a semi-weak Fed allowing inflation expectations to become entrenched. While we don't fully agree with this view, the persistent selling of even the smallest rallies in the bond market can't be ignored. We've now hit a critical point across the bond curve—it's make or break. Without a rally in the 10s, we’re likely heading toward a scenario of much higher rates. The bond vigilantes, who've been in a historic hibernation, may be waking up to have their turn in the sun. Keep a close watch here, as this could be a defining moment for rates and market direction. ---------------------------------------------------------- Stock Market Outlook: We're seeing a bit of selling pressure across stock indices this morning as traders take profits and adjust their positions ahead of the retail sales report. The narrative has shifted over the past few months into a “good news is good news” framework, and with the Fed's perceived dovish stance, we don't expect that to change anytime soon. Fed Chair Jerome Powell had an unexpectedly interesting interview yesterday, where some took his comments as "hawkish." But let’s be real—this is only hawkish compared to the incredibly dovish tone he's maintained recently. The reality is, the Fed has already cut rates by 100 basis points over the last three meetings. And while a pause seems reasonable, there's little in the data to justify that they genuinely believe the economy is ready for it. Be wary of sensational headlines like "Buffett's firm sold $127 billion in stocks over the first nine months of 2024," implying drastic bearish signals. The idea that the Oracle of Omaha is dumping Apple to buy pool noodles misses the point when it comes to trading indices. Large-scale rebalancing by a trillion-dollar operation like Berkshire is more about managing portfolio exposure than signaling anything meaningful for day-to-day flows into the SPX. The macro backdrop, seasonality, and current price structures show no signs of a bearish turn. Yes, we are a bit stretched on the upside, with a 5-day average Carny Quant score of 7. Taking some profits and preparing for a pullback might be prudent, but jumping to "end-of-the-world" conclusions will leave you sidelined as the market grinds higher. ---------------------------------------------------------- Bond Market Analysis: The U.S. Treasury curve is teetering on the edge, threatening to ruin many investors' weekend. Despite what looks like the "perfect" technical setup for dip buyers in oversold assets, the bond market simply can't catch a bid. The 10-year Treasury has been on a slow grind lower since Trump took the lead in betting markets. Every attempt to catch the falling knife has been futile so far. Here's the danger: when an asset grinds lower day after day, it’s the most treacherous time to step in as a buyer. The slow bleed prevents oversold conditions from fully setting in, and these kinds of moves often culminate in a sharp, catastrophic failure. Right now, the bond market is on a path toward just that scenario. A significant collapse in the long end isn't just possible—it’s starting to look probable. As always, in these types of situations, you have to buy—even when there’s a good chance you’ll lose money. The risk-reward here is ripe for a play, but small position sizes and leaving room to be wrong are key. In these notes, I’ve tried to be as honest as possible—trading isn’t about perfect predictions or always being right. I’ve already taken a hit by stepping in too early, and as I lick my wounds, I’m still hunting for an entry into either the 5- or 10-year futures (ZF, ZN). What we’re waiting for is a dip that spirals a bit out of control and then snaps back. Will we get that entry? I don’t know. No one does. But keep your eyes open—it’s these moments that can create the best opportunities. ---------------------------------------------------------- Currency Markets: While BTC bros scream to everyone about "staying poor", the Dollar move could make DOGE coin (and even Elons new DOGE program) blush. We have been negative EU and on some levels the YEN for a decent amount of time and nothing has change. The UK came out with some more negative news overnight, with GDP growth coming in lower than expected at 0.1% for Q3, reflecting sluggish economic performance. The challenge ahead lies in navigating the crosscurrents of the "Dollar Smile." As the dollar rises, many will begin to interpret this as a fear-driven move. Whenever liquidity dries up or global turmoil unfolds, investors run to the dollar for safety. In the coming months, we'll need to discern what’s truly fueling this strength. The dollar has several strong tailwinds—a robust U.S. economy and China's moves to adjust the yuan, aiming to counterbalance the perceived impact of tariffs. You could make your eyes bleed looking into everything the dollar can tell you, but the simple fact remains its the bet play in town. We continue to favor long dollar positions against other currency pairs. However, it's prudent to consider taking profits and waiting for more favorable opportunities. The current upward momentum may soon wane, and you don't want to be caught in a pullback as market flows adjust in the opposite direction. ---------------------------------------------------------- Commodities Market Analysis: Does inflation cause oil to spike, or do oil spikes drive inflation? That’s the macro quandary many are grappling with as we head into the coming weeks. The Carny's take? A resurgence in oil prices typically causes inflation rather than merely following it. Backtesting shows that being long oil during inflationary regimes almost guarantees positive returns—but predicting those spikes is a different story. If you had foreseen Russia invading Ukraine right after a global supply chain crunch and pandemic lockdowns, going long on oil would’ve been an obvious play. But for those of us with even a shred of humility, we know that level of foresight is impossible. Right now, we’re near the bottom of the $66-$73 range, with a Carny Quant score of -8 signaling a potential reflex bounce from oversold conditions. Just don’t fall in love with the position if it works—sellers will come out of the woodwork on any significant rally. And trust us, we’ll be one of them. Will BTC prove the round number theory and hit $100k? Honestly, I can't find a logical reason why it wouldn’t. Forget about value, use cases, or anything else—Bitcoin is a "trading sardine." Its entire purpose is to fulfill dreams. The absurd energy requirements, the flawed framework, and a million other criticisms won’t change that fact. In the short term, BTC has made many people rich, and there’s a large segment of the population, whose livelihoods were “shipped” overseas, looking for a shot at a different life. Bitcoin has become their gold rush. Just like in early U.S. history, where the rush westward led to both fortunes and ruin, BTC is now the place where people are trying to fulfill that dream. Step in front of that momentum at your own risk. I’ll make a separate post about gold since this note is already pushing its limit. Here’s the quick take: Gold is a sell on any significant rally. However, with it currently sitting 3 standard deviations below its 20-day EMA, there’s about a 75% chance it closes higher 5 to 10 trading days from now, based on the historical performance of the GC futures contract. While the longer-term outlook isn’t as bullish, buying dips could be a prudent short-term play. Summary: Markets are reacting to Trump's election with inflation concerns driving bonds to a critical point. In equities, profit-taking ahead of retail sales is not a shift in sentiment but a cautious pause. The dollar remains strong but may soon tire—take profits selectively. Oil is near the bottom of its range, primed for a short-term bounce, but don’t fall in love with rallies. Bitcoin edges toward $100k on sheer speculative momentum, while gold, despite a weaker long-term outlook, could see a short-term rebound from oversold levels. Good luck and God Bless!

Nik “The Carny” Lentz @NikLentz

2 years ago

Market Insights with The Carny – Nov 13, 2024 (Please like and RT if you find this useful, thank you!) Today, we get a fresh look at inflation data. In the distant past, this used to be the single most important print on the calendar. However, its impact has diminished since

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Market Insights with The Carny – Nov 6, 2024 (Please like and RT if you find this useful, thank you!) The game plan from last night played out perfectly, and this morning we’re approaching the markets with a refreshed outlook. Today’s post will dive into the shifting dynamics at play and, more importantly, set the stage for what’s likely to matter most under a Trump presidency. Expect changes ahead in key areas like rate cuts, taxes, tariffs, and stock valuation metrics. Stock Market Outlook: The Carny Quant held steady in the high-risk portfolio through all the election drama, reminding us once again that asset prices are always a step ahead of pundits and economists. We’re about to hear endless takes on term premiums, repo facilities, dollar strength, inflation metrics, and every angle to explain or fade equities. While these factors matter, equities are, and will always be, the bluntest of macro assets, riding on long-term growth in cash flows and market share. Plus, the U.S. remains largely insulated from many global challenges. Some might take issue with calling stock indices the “dumbest” of macro assets, but it’s their ability to look past daily noise that makes them powerful compounders over time. That said, we’re entering a period where the Fed may act more as a headwind than a tailwind. With Powell wary of a second Trump term, there’s a chance of his resignation. If he stays, expect some standoff. The recent 50 bps cut seemed geared to boost the economy pre-election, leaving the Fed in a tough spot as they lose control of the bond market’s long end. We expect the Fed to come out hawkish, and though a Thursday pause is unlikely (about a 30% chance), they’ll likely try to take a few cuts off the table. Short-term, this could be negative for risk assets, making it a good time to take profits on some long-term holdings. No need to panic, but be ready for the newly elected eagle to face a few upset hawks ahead. Bond Market Analysis: Heading into election night, we added shorts across the SOFR curve, with betting markets and insider polls signaling a potential Trump landslide. We expect the Fed to come out hawkish, asserting its independence and likely clashing with Trump. Unlike many, we’re not as bearish on the long end; we see an opportunity for an overextended bounce to the upside. While we took partial profits on our 10-year position, in hindsight, fully closing it would have been smarter. The SOFR shorts softened those losses, but it was still a misstep. Looking ahead, we’re eyeing long plays in the 5- to 10-year range and anticipate a potential short squeeze if the Fed gets aggressive on "inflation". If you're short, we suggest covering all exposure. A bond bounce could be triggered by several factors, and in a twist, we may see equities take the lead and drive bond buying—contrary to the conventional wisdom that bonds are the “smartest” asset in the room. Currency Markets: Our pre-election strategy unfolded as anticipated, with EUR/USD serving as our preferred vehicle for capitalizing on dollar strength. While some remain optimistic about the EU's prospects, we find little reason to believe in such narratives. The Japanese yen has weakened significantly, as Japan continues to rely on forward guidance, promising a series of rate hikes extending into 2028. However, the market is skeptical, making shorting USD/JPY a risky endeavor. We continue to favor EUR/USD for positioning on dollar movements. If you're short EUR/USD, it's prudent to take profits now, as we're approaching key structural levels, and holding further may be overly aggressive. Wait for things to adjust to more natural levels as the next trades present themselves for the coming months. Commodities Market Analysis: Oil has done what oil does. We’ve talked endlessly about the nature of this market: Trump is bearish oil, India’s economy is bearish, China’s slowdown is bearish (though fiscal stimulus could be a boost), and Russia losing India as a buyer for its “illegal” crude is causing panic selling to fund the war. The list goes on. The era of oil is ending, and Trump in the White House won’t ease the supply concerns of oil bulls. A new range is starting to develop between 66-73, but it’s too early to trade it. Sit back, let it form a solid series of highs and lows around those levels. Until then, it will take geopolitical headlines to shake it loose from its fundamentals before considering shorts again. Gold is losing a little luster. If you haven’t taken profits by now, there’s not much I can tell you. With a likely hawkish Fed and China/other central banks pulling back on buying, we don’t see a strong case for holding it. Expect rallies to be sold going forward. As for digital gold, that’s a different story. Many believe the "right" is pro-crypto. While we don’t think a bunch of boomers actually care about or own “bits in the sky,” we’re not shorting it. Friends don’t let friends short all-time highs, and hopefully, we’re at least acquaintances by now. Avoid betting against momentum, especially when you have gold to do the same trade. Summary: With Trump’s victory shaping the economic landscape, we expect to see a hawkish Fed looking to assert its independence, potentially creating headwinds for risk assets. While equities remain resilient, it’s wise to take some profits given the Fed’s likely stance on rate cuts and inflation. Bond markets are also set for adjustments, with potential short squeezes in the 5- to 10-year range as the Fed’s actions unfold. Currency-wise, EUR/USD remains our preferred play for dollar strength, while USD/JPY looks too risky for shorts amidst Japan’s forward guidance. In commodities, oil faces a challenging road, with bearish pressures from global demand concerns and a shifting supply landscape under Trump. As for gold, rallies are likely to be sold, with momentum shifting elsewhere. Good luck and God Bless! ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. !!!!!!! I am NOT a professional. Trade at your own risk !!!!!!! ----------------------------------------------------------

Nik “The Carny” Lentz @NikLentz

2 years ago

Market Insights with The Carny – Nov 5, 2024 Election Day... Days? (Please like and RT if you find this useful, thank you!) If I had any real advice for today, it’s to take it easy and save your energy for tonight. While you likely won’t be trading the overnight action, it’ll

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Market Insights with The Carny – Nov 3, 2024 (Please like and RT if you find this useful, thank you!) Friday's market played out as expected after the non-farm payroll report we previewed—right up until the equity open, when everything reversed sharply and closed at the lows. My P&L took a ~2% hit, but as of this morning, the world seems to be back in order, and they’ve kindly returned my money. This shift previewed what’s likely driving assets into today and tomorrow. Following the dismal 12k non-farm print, more "sophisticated" players seemed to steer the market, but the equity open revealed what appears to be the Trump trade in action: - Strong dollar - Weak bonds, especially long end - SOFR whites through greens down - Implied hawkish FED response Over the weekend, Harris’s odds improved as many took profits from extreme betting market moves. The EUR has recovered, bonds are bid, and many of the players who went all in on a Trump victory are now caught offsides, debating whether to bail. This is not where you want to be, so expect the market to pressure those positions until the equity open. We’ve closed our long EUR position and continue to hold the long 10-year. Long-term, we're bearish on both the EUR and the long end of bonds but are playing a bounce off overextended conditions and take issue with the extreme outcomes being priced in around the election. I'm not rewriting the election playbook here but will post it below this daily note to share my thought process on the different scenarios. Overnight, several updates are worth noting. Many believe China is bluffing on stimulus, with the WSJ suggesting that hopes for a big “bazooka” stimulus move are wishful thinking, as sources say it’s unlikely this year. Still, there’s little reason for China to bluff. Yet, they continue to shoot themselves in the foot with moves like demanding wealthy individuals and companies double-check their taxes. We remain flat on long KWEB trades and see no reason to add, but we’re expecting a sharp squeeze once China faces reality and is forced to adopt the West’s playbook. The stimulus is coming—it’s just a waiting game. Oil is having a bullish moment as OPEC delays its anticipated production cuts, waiting on the U.S. election outcome. Iran is also playing into this, with the WSJ noting that Iran intends to delay its response until after Tuesday’s vote but before the new president’s inauguration in January. Despite these developments, the fundamental outlook for oil remains bearish. Wait for optimal levels before selling, but overall, geopolitical events should be opportunities to sell rather than chase. Everything else is covered in my election preview. Good luck and God Bless! ---------------------------------------------------------- Follow @PiQSuite for best News Source on the internet! Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions. ----------------------------------------------------------

Nik “The Carny” Lentz @NikLentz

2 years ago

Market Insights with Nik "The Carny" Lentz – October 30, 2024 Quick Note: (Please like and RT if you find useful, thank you!) As we hit the midpoint of a hectic econ schedule, we're awaiting the first GDP reading, the dreaded ADP report we swear off but always trade, and the

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